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Equity Release

View profile for Sophie Barnes
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Many people have heard of the term, but don't understand what it is or how it works. Equity release is an option for homeowners to release tax-free cash from their property. It is becoming an increasingly popular way for people in or approaching retirement to enhance their finances and complement their pensions.

Equity release can be an invaluable resource to financial planning throughout retirement.

There are two main types of equity release schemes; reversion schemes and lifetime mortgages. The most common is the latter. These are a special type of mortgage, with a rate of interest which is fixed for life. Interest rolls up until the capital is repaid, either on death, on moving into Long Term Care, or on the sale of the property so there are no monthly payments to make. Some schemes do allow interest only payments to be made if that is more suitable to your circumstances.

Will my family inherit my debt?

No – all common lifetime mortgages on the market today have a no negative equity guarantee, meaning you will never owe more than the property is worth.

Will I still own my property?

Yes. One of the most common misconceptions about equity release is that you will not own your property – with a lifetime mortgage you will. They work very much the same as a standard mortgage in this respect. It is a loan secured against your property, giving you access to a lump sum of cash, and you will still own your home.

How do I know if I qualify?

To qualify you must be over 55, and own a property over £70,000. How much you can release depends upon your age, state of health and how much your property is worth.

What do people use the money for?

Equity release clients use the money for a variety of things, including repaying existing debts, enjoying their retirement, and making home improvements to the home they plan to spend the rest of their days in.


If you want to find out more, please do not hesitate to get in touch with our team for expert, personalised advice on this area.

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Equity Release – Includes lifetime mortgages and home reversion plans. To understand the features and risks, please ask for a personalised illustration. Equity released from your home will be secured against it. Your home may be repossessed if you do not keep up repayments on your mortgage.