What is equity release?

Equity release lets homeowners aged 55 and over release tax-free cash from the value of their home. The amount you can release is based on your age and how much your home is worth. Depending on the equity release product you choose, you can claim your money as one big lump sum or as a series of smaller lump sums.

You can use the money you release however you like.
• Help your children with money difficulties or to buy their own home
• Live out your dreams of travelling the world
• Pay off your loans
• Make vital improvements to your home as you grow older
• Have some extra money to help you enjoy your retirement

Your chosen lender can also give you the option to protect an inheritance for your family from the value of your home. The amount you protect won't be used when calculating how much you can borrow. You can discuss this with your financial advisor.

Some equity release providers also offer a no negative equity guarantee. This means that the money you'll eventually need to pay back will never be more than the total value of your home. You won't need to pay the money you have released back until the last surviving borrower passes away or moves out of the home into long-term care. The loan is usually paid off from the sale of your home.

Learn about the different types of equity release and which might be right for you.

How much could you release?

Interested in equity release? Find out how much you could release with our quick and easy to use equity release calculator.

Use our calculator

Is equity release safe?

Equity release is a highly regulated and popular way to release your money. In our article, we address some of the myths around equity release to help you feel confident about your decision.

Is equity release a good idea?

How does an equity release mortgage work?

Get advice

As a first step, you'll need to speak to a financial adviser who's qualified to advise on equity release products.

Your adviser will check your eligibility and take the time to understand whether equity release is right for you.

Based on your personal wants, needs and financial position, your advisor will give you their recommendation.

Valuation and offer

If you're happy to go ahead, make sure you appoint a solicitor who specialises in equity release to act on your behalf and offer independent legal advice.

Your adviser will then help you submit your application to your chosen lender. Your lender will contact you to arrange a valuation of your home.

Once your lender has approved your application and completed your valuation, they'll send the offer and terms through to your solicitor.

Receiving your money

If you're happy with the offer, your lender will release your money to your solicitor. Your solicitor will then release the money to you as you agreed with your lender, for example as one lump sum or the first smaller sum of a series.

“My son has always wanted to get on the property ladder but has never been in a position to save up enough for a deposit. I spoke to a couple of financial advisers and the name that kept coming up all the time was Legal & General. The lifetime mortgage has ensured that my son, now feels secure. That is worth more than any money. I’m very happy I was able to do that for him.”

- Evadne, Nottingham

Find out how much you could release
Evadne and her dog

Pros and cons of equity release

Benefits of releasing equity:

  • The money you release is completely tax-free.
  • You can protect an inheritance for your family.
  • You can stay in your home without having to make any sacrifices, downsize or move to a cheaper area to release some money.
  • Most lenders offer a no negative equity guarantee so you'll never owe more than the value of your home when it is sold.
  • There's no need to repay the loan until you pass away or move out of your home and into long-term care.
  • If you wish to repay some of your loan early, there are flexible repayment options for you to choose from.
  • After taking equity release, you can still move house.

You might want to carefully consider:

  • If you gift some of the money to family, they might have to pay Inheritance Tax in the future.
  • Interest on a Lifetime Mortgage is calculated daily and added to the amount you owe each month. This means that the amount you owe will quickly increase over time, reducing the equity left in your home.
  • The inheritance you leave will be reduced.
  • If you pay back some of the loan early, you may be subject to an Early Repayment Charge.
  • Releasing equity may impact your entitlement to means-tested state benefits.
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Get equity release advice

Our equity release specialists are waiting to answer your questions about equity release.

For any other enquiries please get in touch via our contact us page

0808 301 70440808 301 7044

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Frequently asked questions about releasing equity

More about later life mortgages

Compare later life mortgages

Which later life mortgage is right for you?

Lifetime Mortgages (a type of equity release) and Retirement Interest Only Mortgages are sometimes grouped together as 'later life mortgages' or 'later life lending' products. While similar and often used for similar purposes, these are different products and it's important to understand the differences between the two. There may be cheaper ways for you to borrow money.

Find out more about our range of later life mortgages, or use our simple tool to find out which product might best suit your needs.

Compare later life mortgages Which later life mortgage?

Retirement Interest Only Mortgage

A type of residential mortgage.

A Retirement Interest Only mortgage is a loan secured against your home. You have to pay the interest off monthly, but the full amount of the loan isn't usually repaid until you die or move out of the home into long-term care. As a last resort, your home may be repossessed if you do not keep up repayments.

If you're looking to release some money from your home to pay off an existing mortgage, this is one of the options available to you.

About our Retirement Interest Only Mortgage Retirement Interest Only Mortgage calculator