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Your top 10 equity release questions answered

Have a question about equity release? We’re here to help – and if you want to learn even more, you can request a free equity release guide.

model paper house with question marks above

1. What is equity release?

Equity release is available to homeowners aged 55 and over. It’s a way to unlock money tied up in your home – without having to move or downsize to a smaller, cheaper property. The money you release is tax-free, and it’s yours to spend as you wish.

Read more about what equity release is.

2. How does equity release work?

First of all, the ‘equity’ in your home is the difference between the market value of your property and the mortgage (or other debt) you have against it. The amount of equity you have in your home can go up as you pay off the mortgage (or other debt). If property prices rise, the amount of equity you have in your home can also increase.

Read more about how equity release works.

pile of coins and a cardboard cutout of a house

3. What types of equity release plan are there?

There are two main types of equity release plan to choose from:

Lifetime mortgage – This is the most popular type, where a loan for an agreed amount of tax-free money is secured against your home. There are no monthly repayments and you retain full ownership – and repay the loan and interest when your home is sold or you go into long-term care.

Home reversion plan – You sell part or all of your home in return for tax-free cash. And you can live there rent-free until you pass away or move out permanently (for example, into care).

Read more about the different types of equity release plans.

4. How much equity can I release?

Well, the exact amount will depend on your circumstances and the type of plan you take out. When deciding how much to offer you, equity release providers will look at how much your property is worth and how old you are when you take out your plan.

As a rule of thumb, you can usually expect to release between 20% and 50% of the equity in your home. And generally speaking, the older you are, the more money you can release.

Use our FREE Equity Release Calculator to see how much you could release.

cardboard houses a clock and a pile of coins

5. How much does equity release cost?

There are usually some initial charges and fees to set up your equity release plan, depending on the provider you choose. These can include:

  • Advice fee
  • A valuation fee (to value your property)
  • Your legal costs (your solicitor will give you a breakdown of these)
  • Buildings insurance (to make sure you meet your lender’s requirements) – if you don’t already have this in place

Typically, these can add up to between £1,500 and £3,000. Make sure you ask your advisor about these costs before making any commitments.

Find out more about equity release and book your free appointment.

6. How long does equity release take?

The timeframe varies from provider to provider. But it normally takes around 8 to 12 weeks – from the day the provider receives your application to the day your solicitor sends you your money.

Read our guide to equity release.

man and a woman holding hands with a young boy

7. Will equity release affect my family's inheritance?

Yes, it will. With a lifetime mortgage, you get a tax-free lump sum or regular cash payments – and your loan plus interest is repaid when you pass away or move into permanent care.

The money is usually paid back through the sale of your home – and that means your family won’t be able to inherit your property. However, any money left over from the sale can be passed on to your loved ones.

There are also other ways to make sure you do leave an inheritance. You can choose to ringfence some of the value of your home to leave as a legacy – just make sure you talk to your advisor when you meet them for the first time, and they can help you with a suitable plan.

See how tax-free cash from equity release could help your family.

8. What happens to equity release when you die?

That depends whether you have a joint equity release plan (in yours and your partner’s name) or an individual equity release plan (in your name only).

Joint equity release plan – You and your partner have the right to live in your property until the last remaining partner passes away or moves into permanent care. After this, the home is sold and the loan is repaid.

Individual equity release plan – When you pass away or move into permanent care, the home will be sold to repay the loan (unless your partner can afford to repay the provider in full). You should always get professional advice before making these kinds of financial decisions.

middle-aged couple discussing their finances

9. Can I release money from my house?

If you’re a UK homeowner aged 55 or over, then you could release money from your house with equity release.

You can find out about your eligibility by calling The SunLife Over 55 Equity Release Service on 0800 633 5566.

10. Is equity release a good idea?

If you find yourself with equity in your home but limited funds for your retirement, equity release is a potential solution. Equity release means you can:

  • unlock tax-free cash from your property
  • stay in your own home
  • spend the money as you wish

Today, the equity release market is regulated by the Financial Conduct Authority (FCA), so you can have peace of mind that it’s safe and you have protection.

That said, it’s important to bear in mind that equity release isn’t right for everyone. And you should make sure you consider alternative options to fund your retirement too – including using your savings and downsizing.

Read about the pros and cons of equity release.

Finally… make sure you seek advice

Just like any financial decision, equity release is a big commitment. So take the time you need to consider your options and decide whether or not it’s right for you. You should seek advice from an independent expert advisor to make sure you fully understand what’s involved with equity release. And The SunLife Over 55 Equity Release Service is here to help you do that.

Whenever you’re ready, we’re here for you

For more information and to check your eligibility, call The SunLife Over 55 Equity Release Service today on 0800 633 5566 or request a call back.

Here's the information that you need to know about who we are and the other companies that we work with in order to provide our products and services.

Who are SunLife?

Phoenix Life Limited trades as SunLife and is the provider of the Guaranteed Over 50 Plan, SunLife Insurance and the life insurance policy payment option for Funeral Plans. Phoenix Life Limited’s registered office is at 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 1016269). Dignity Funerals is not authorised or regulated for this activity by either the Financial Conduct Authority or the Prudential Regulation Authority. Dignity Funerals Ltd is a member of the National Association of Funeral Directors.

SunLife Limited distributes financial products and services and is a company limited by shares, registered office: 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 05460862). SunLife Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (registration no. 769427).

You can contact us by post at SunLife, PO Box 1395, Peterborough, PE2 2TR or by phone on 0800 008 6060.

If you choose to add Funeral Benefit Option to your Guaranteed Over 50 Plan the funeral services are arranged and provided by Dignity Funerals Limited. Dignity Funerals Limited is a company registered in England and Wales No. 00041598. VAT registered No. 486 6081 14. 4 King Edwards Court, King Edwards Square, Sutton Coldfield, West Midlands, B73 6AP. Telephone No. 0121 354 1557. Fax No. 0121 355 808. Part of Dignity plc. A British Company. Dignity is not authorised or regulated for this activity by the Financial Conduct Authority or the Prudential Regulation Authority but is a member of the National Association of Funeral Directors.

Who provides the Funeral Plans?

Dignity Funerals Ltd arranges and provides the funeral services. Dignity Funerals is not authorised or regulated for this activity by either the Financial Conduct Authority or the Prudential Regulation Authority. Dignity Funerals Ltd is a member of the National Association of Funeral Directors.

The life insurance policy that pays for your funeral will be provided by Phoenix Life Limited, trading as SunLife.

Who provides My Smarter (ISA)?

My Smarter (ISA) is provided by Scottish Friendly Asset Managers Limited. Authorised and regulated by the Financial Conduct Authority. Details can be found on the Financial Services register, registration No. 188832. Member of The Investment Association. Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ.

Who provides the Will writing services?

Hugh James is authorised and regulated by the Solicitors Regulation Authority (SRA Number:303202).

The information contained on this website is based on Hugh James' understanding of the law of intestacy in England and Wales only as at April 2014. The law in Scotland and Northern Ireland is significantly different. This is for information purposes and is not intended to be legal advice.

Who provides Family Life Insurance?

SunLife Family Life Insurance is provided by Scottish Friendly Assurance Society Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Details can be found on the Financial Services register (registration number 110002). Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ. 

Who provides SunLife Pet Insurance

SunLife Pet Insurance is arranged and administered by BDML Connect Limited. BDML Connect Limited is authorised and regulated by the Financial Conduct Authority (No. 309140). Registered in England and Wales Number 02785540. Registered Office: 45 Westerham Road, Bessels Green, Sevenoaks, Kent, TN13 2QB.

Who provides SunLife Home Insurance

SunLife Home Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.

Who provides SunLife Car Insurance

SunLife Car Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.