How does Equity Release work?
Equity release explained in a few simple steps
You may be wondering, what is equity release? Or how does equity release work? Your “equity” is the difference between the value of your home and any mortgage you might owe.
By releasing a portion of the equity, you’ll have money to spend achieving your goals – from home improvements to giving your family a helping hand – and you won’t have to move from the home you love.
Step 1
Do you qualify? Do you own your own home and is the youngest homeowner aged 55+? If ‘yes’, you are likely to qualify, even if you have a standard mortgage or loan secured against your property. However, you will have to pay this off with the money you receive from your equity release plan.
Step 2
Is equity release the right option for you? To find out, get in touch with us for specialist advice. We’re happy to talk you through the many plans available and recommend the best plan for your circumstances with a free, no-obligation equity release quote. This will allow you to make an informed decision about whether or not to go ahead. If you decide it’s right for you, we will be on hand to guide you through how to release equity from your home.
Step 3
Fill in the application form. We’ll talk you through this process and once completed, we can arrange to pick up all the documents we need from your home. We’ll then oversee your application until it completes, keeping you informed at every stage.
Step 4
Receive your money. Most equity release applications take between six to eight weeks to complete. However, we will do all we can to keep this wait to a minimum and make sure the funds clear in your bank account as quickly as possible.
The right products make the right plans...
Of course, our equity release service can only be as good as the equity release plans that we offer. Which is why we put such effort into working with lenders on developing new plans and features for you. This allows us to be sure that our customers like you will receive a solution ideal for their needs.
There are plans that allow you to:
- Access a lump-sum of money, perhaps for a one-off purchase.
- Release smaller amounts over time, this can be more cost-effective.
- Protect some inheritance for your loved ones, using an Inheritance Protection Guarantee
How much tax-free cash can you unlock from your home?
Use our free calculator to get an instant view of how much tax-free cash you could release to help you live your life, your way.
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A few things to think about
Equity release will involve a home reversion or a lifetime mortgage, which is secured against your property and will reduce the value of your estate and impact funding long-term care. You can read more about the different types of equity release plans here and if you want more detail we can provide you with a personalised illustration to explain exactly what equity release could mean for you and will outline the features and risks.
You must take financial advice before proceeding with equity release. It’s important that you make the right decision. That’s why we provide our initial advice for free and without obligation. Only if your case completes would our advice fee of £1,895 be payable. Other lender and solicitor fees may apply.
You will need to pay off any existing mortgage or secured loan that you have. You can use some of the money raised through equity release to do this.
Another consideration is that equity release interest is compounded, so you pay interest on interest. The money you release, plus the accrued interest is then repaid when you die or move into long-term care.
Equity release may have an impact on your entitlement to means-tested benefits now and in the future.
We are proud to be the UK’s number 1* equity release advisor
Each year we help over 600,000 people explore the option of equity release.
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You’re talking to the people who know.
We will talk you through all your options and explain all the pros and cons of equity release, so that you’re fully informed.
Our service is about finding out if equity release is a good fit for you, and only then will we find the best equity release plan for your individual needs.
Our promise to you...
- You will be assigned a dedicated advisor who will guide you through the process from start to finish.
- Equity release will only be recommended if it’s suitable for you.
- We will search a range of plans from multiple lenders to find the best solution for you.
- The plan that we recommend to you will be protected by the safeguards of the Equity Release Council.
- You will receive a bespoke recommendation document to read at your leisure.
