Equity release

Getting advice from an expert adviser

An adviser will help you decide if releasing equity is right for you. You can speak to them over the phone, through a video call, or face-to-face. They’ll explain all of the details and the options available. Here’s what your expert adviser will do, and what they’ll discuss with you.

Compare equity release plans

Your adviser will be able to talk through all the options and find the right equity release plan for you.

As plans vary in features, they’ll ask you to think about what’s most important to you. For example, you may choose a plan that lets you make monthly repayments. Or one that allows you to ring fence some of the value in your home to leave as inheritance.

Interest rates

Your adviser will try to find you the right scheme with the lowest rate possible. The interest rate will depend on your age and circumstances, and which type of plan you choose.

Lowest rate available

2.34%

We last checked this on 2 February 2021.

If you use our service, you’re guaranteed the lowest possible rate on the market.

Types of equity release plan available

Your adviser will discuss different plan types and how they might work for you.

Lifetime mortgages – the most popular way to release equity

Access a lump sum, with no need for monthly repayments, and you’ll still own your own home.

Drawdown lifetime mortgage

Release cash in instalments over time, and only pay interest on what you’ve taken.

Interest-only lifetime mortgage

Release tax-free cash, and reduce interest by making repayments.

Home reversion

You sell all or part of your home to access a lump sum and live there rent-free.

Understanding the benefits and risks

Releasing equity isn’t right for everyone, so your adviser will help you to weigh up the pros and cons.

• You’ll get tax-free cash for retirement to supplement your income.
• You can stay in your own home and legally own it until you die or move into permanent care.
• There’s no need for monthly repayments, although you can choose them with some plans.
• It won’t leave your family in debt.
• You can choose to ring fence some of the value of your home to leave as inheritance.

• Interest is added each year and can grow quickly.
• There’ll be less inheritance for your family as equity release reduces the value of your estate.
• Your means-tested benefits and tax position may be affected.
• You may not be able to borrow more in the future.
• There may be fees to pay, though you can use some of the money you release to cover them.

Important information

• You continue to own your house with a lifetime mortgage which is a debt secured against it. The value of equity released, plus accrued interest, is to be repaid upon death or moving into permanent long-term care.
• If you have an existing mortgage, you must use the money you release to pay it off first

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Applying for equity release

Applying for equity release isn’t a rushed process. There’s lots of advice and support along the way to make sure it’s right for you.

1. Call 0800 633 55 66 to make an appointment with an impartial financial adviser

   We’ll check your eligibility with a few quick questions, before putting you through to experts from our partner Age Lifetime.

2. Talk it through with your adviser

   You’ll discuss your circumstances, the options available and whether equity release is the right option for you. You can talk to your adviser as many times as you need.

3. Complete your application

   Your adviser will recommend the best plan for you and send you all the information. If you decide to go ahead, you’ll need to complete an application. Your adviser can help with this.

4. Get independent legal advice

   You’ll need to speak with a solicitor once you’ve returned your application. Your adviser can recommend suitable solicitors if you’d like them to.

5. Receive your money

   You’ll usually receive your cash lump sum or first instalment within 6 – 8 weeks of returning your application, but it could be sooner.

Spending the money you’ve released

Once you receive your cash you’re free to spend the money how you wish. The only exception is if you have a balance left on your mortgage, in which case you’ll need to use some of the cash to pay it off.

How SunLifers have spent their cash lump sum

Equity release versus downsizing

What is equity release?

5 common equity release myths

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After equity release

Repaying your equity release loan early

Whether you can repay the equity you’ve borrowed early will depend on your plan provider. There are often early repayment fees, so it’s best to check with your provider and equity release adviser before making any decisions.

Selling your house after equity release

With many schemes you can still sell your house once you’ve released equity. Just be aware that certain conditions may apply and there may be fees to pay. Your adviser can discuss this with you in more detail.

What happens when you die, or move into care

It depends on the type of plan you chose. Usually, with a lifetime mortgage your family would need to sell the property and then repay the debt with the money from the sale. Whereas with a home reversion plan, your equity release provider would need to sell it.

The loan usually needs to be repaid within 6–12 months of your passing. It’s to best to speak to the plan provider to confirm what needs to be done.