The Best & Worst Equity Release Companies of 2021
Best in the UK
There are many well-known equity release providers in the UK. More 2 Life, LV, and Aviva are great companies to choose from.
Some companies also worth mentioning include:
- Hodge, which is the longest-established provider in the UK
- HSBC, a bank and financial services company
- Just, a savings, credit, pension and mortgage provider
- L&G, a multinational financial service provider
However, it’s also good to know which companies to avoid.
Worst in the UK
Any equity release company that doesn’t have a ‘no negative equity guarantee’, that isn’t a member of the ERC, or charge high interest rates should be avoided.
Do your research! To contrast the best and worst companies, let’s look at our top 5.
Top 5 Companies In This Market
It’s vital for your future finances that you know everything about the companies that provide equity release services. If you choose one of the companies we suggest, you won’t have anything to worry about. Our top 5 providers are reliable, experienced, and will take care of your needs.
Aviva is a household name in the UK. They’re known mainly for their pension plans and insurance products. To add to that, they’re one of the oldest financial service providers. If you’re considering them, it’s good to know that their equity release products are award-winning and that over 200 000 people have made use of them. Since 1998, Aviva has helped people release a total of £7 billion from their homes.
Aviva’s primary services include:
- Inheritance guarantee services
- Voluntary partial repayments
- Enhanced borrowing (if you have certain medical conditions)
- Downsizing protection services
- Relaxed lending services
Aviva has a lot to offer, and they’ll be an excellent choice.
In 1965, Hodge Lifetime launched its first equity release plan, making them the longest established provider in the UK. Julian Hodge Bank Limited is the product provider2. As one of the oldest providers, they’ve built up an excellent range of equity release products and an established customer base. They’ve created a superb retirement mortgage range to go with their traditional lifetime mortgage plans.
Hodge Lifetime provides an interest-only mortgage plan requiring monthly interest payments. The rest of the loan must be paid back when you pass away or move into long term care.
Extremely popular in the post-retirement marketplace, they’re known for their excellent range of annuities. They’ve also started lending cash through equity release plans.
Let me tell you:
Just Retirement has a unique equity release model, which has proved to be one of its core strengths. Not only do they lend money directly to borrowers, but they also fund other company’s equity release plans. Their equity release plans include a wide range of traditional lifetime mortgages, including drawdown lifetime mortgages, interest-only lifetime mortgages, lump-sum equity plans, and enhanced equity release plans.
LV (Liverpool Victoria)
LV, or Liverpool Victoria, is known as a mutual society and was established in 1843. Their target market is working-class people to whom they offer a range of equity release plans such as drawdown lifetime mortgages and lump-sum schemes. With this versatile provider, you can get equity release on your primary residence, your secondary residence, and your holiday home.
Legal & General
They’re also a household name and joined the lifetime mortgage industry in 2015. They have two lifetime mortgage options: the L&G Income Lifetime Mortgage and the L&G Flexible Lifetime Mortgage.
Let’s take a closer look:
L&G Flexible Lifetime Mortgages
You get colour-coded based on the amount of money you can borrow according to your property’s value (LTV). For example, “Flexible Pink.” The amount of interest you’ll pay will depend on the LTV.
All these are drawdown plans that L&G offer. With these, you’ll be able to borrow a minimum amount of £10,000. The “Flexible” mortgages range allows voluntary repayments which give you up to 10% of what you borrowed annually, but you won’t be penalised.
L&G Income Lifetime Mortgage
Also colour-coded, the same rule applying to the Flexible Lifetime Mortgage applies here. You’ll pay more interest when the LTV is high. These plans give you a fixed monthly payment for 10-25 years. This amount starts from £200.
Want to Get the Best Rate? » Get the Top Equity Release Quote Here.
What Equity Release Company is the Best?
Of course, it all depends on what you’re looking for. But overall, here are 20 of the best companies in the UK:
- Age Partnership – a member of the Equity Release Council, quality guaranteed
- Ashfords – advisory service on legal elements regarding mortgages
- Aviva – biggest insurance company in the UK and best pension provider
- Barclays – multinational investment bank and best in business worldwide
- BBC – excellent for lifetime mortgages and reversion plans
- Bridgewater – American, but serve foreign banks, investments and pension funds
- Canada Life – allows you to invest in mid-cap companies
- Club Crown – development on real estate and equity release
- Daily Mail – spreading equity release awareness
- Equity Release Club – a private capital initiative
- Equity Release Supermarket – best advisory service in Britain
- Equity Release Wise – manage private equity closed-end money
- Go Compare – a versatile insurance company, even pet insurance
- Guardian – daily newspaper in Britain talking about equity release
- Halifax – private equity firm investing your money in profitable companies
Is the 'No Negative Equity Guarantee' In an Equity Release Company Needed?
It protects you so that you don’t pay more than you owe to your equity release provider. However, when your lifetime mortgage plan comes to an end, the lender will sell your house and settle the loan amount plus any interest.
If the estate market value decreases and the money can’t repay your mortgage, the lender won’t request more cash from your estate or heirs. Since you’ll be protected by the ‘no negative equity guarantee’, they aren’t legalised to do so. Therefore, consider the equity release firm that will offer you this protection. And yes, it’s needed as you can see.
What Equity Release Companies Should You Avoid?
Companies in the UK that aren’t registered with the FCA, or are members of the Equity Release Council should be avoided. Why? Because then they’re not under strict rules and regulations that are for your benefit.
Providers who are members of the ERC offer:
- A no negative equity guarantee
- Capped/fixed interest rates
- The right to live in your house for life
- The right to move to a new house
Does the ERC Protect Me from Rotten Companies?
Yes, the only job of the Equity Release Council is to protect you and your finances. That’s all they’re there to do. They’ve set up rules and regulations to protect you from bad companies that are only out to get your money.
In the end, equity release offers many advantages, but it can also have its fair share of downfalls, depending on your circumstances. You need to do the research, and you need to speak to professionals who can analyse your situation and advise you appropriately.
It’s essential to choose a provider that offers the most competitive rates, flexible products that can be tailored to your needs, and ongoing customer service. With the guidelines above, you’ll be sure to make the right choice.