Learn more about equity release

Equity Release

Unlocks tax-free funds from your property while allowing you to remain living in your home. There are different types of equity release, including lifetime mortgages and home reversion plans, each with it’s unique features and considerations. Repayment occurs when the property is sold following your passing or transition into long-term care. Suitable for homeowners aged 55+.

Learn More: What is Equity Release and How Does it Work in the UK?

Lifetime Mortgage

A popular equity release product where a fixed or variable rate loan is secured on your main residence. You retain full ownership; interest compounds over time and is usually only repaid upon death or entry into permanent care, though voluntary repayments are increasingly available.

Home Reversion Plan

This involves selling part, or all, of your property to a provider for a lump sum or regular income, while retaining the right to live in the home, rent-free, for life. Providers receive their share when the property is sold, often at below market value.

No Negative Equity Guarantee

A statutory and regulatory safeguard ensuring that your estate, or your heirs, will never need to repay more than the final sale value of your home, even if the debt and accrued interest exceed this amount.

Drawdown Facility

A flexible lending option permitting homeowners to release equity in stages, so interest is charged only on withdrawn funds, helping control interest growth and suit long-term financial needs.

Roll-Up Interest

Interest that is charged and added to your total outstanding loan amount each year, compounding until the loan is settled. No monthly repayments are typically required unless chosen.

Inheritance Protection

A feature in some products that lets homeowners guarantee a certain proportion of the property’s value for their beneficiaries, safeguarding a legacy despite equity release borrowing.

For a detailed explanation, see How Does Inheritance Protection Work With Equity Release?.

Early Repayment Charge

A fee sometimes payable if you seek to repay your equity release loan, or move home, outside of standard terms. Exceptions including downsizing protections may apply depending on the lender.

Learn more about the costs involved with equity release by visiting the Equity Release Costs Checklist.

Enhanced Lifetime Mortgage

A special type of lifetime mortgage offering increased borrowing amounts or more favourable terms for those with specific health or lifestyle factors considered to reduce life expectancy.

Voluntary Repayments

The facility to make regular or ad hoc payments to reduce either interest accrual or outstanding loan amount, limiting the total cost to your estate over time.

Porting

The process of transferring your existing equity release plan to a new property, subject to lender approval and suitability criteria of the new home.

Downsizing Protection

Permits homeowners to repay their equity release plan without penalty when moving to a smaller property that does not qualify for porting. Useful if circumstances change during retirement.

Compound Interest

Interest charged on both the principal loan and on any interest that has accumulated, resulting in potentially significant increases in overall debt where repayments are not made.

For a detailed look at current rates and market leaders, see the top 10 equity release companies in the UK.

Equity Release Council (ERC)

The industry regulator and standards body for equity release providers and advisers, ensuring product safety, consumer protection, and market transparency within the UK.

Independent Financial Advice

Impartial, professional advice from accredited advisers, required before entering an equity release contract to determine suitability and safeguard your interests.

Learn More: Pros and Cons of Release Equity

Property Valuation

A formal valuation by a qualified surveyor is mandatory to calculate the market value of your home and set your potential borrowing amount, factoring into how much equity can be released.

Loan-to-Value (LTV)

The proportion of your property’s value available to borrow as equity release, typically determined by age, health, and lender policies.

Fixed Interest Rate

Guarantees your interest rate throughout the duration of your plan, allowing for certainty over repayment and total debt accrual.

For the latest rates, visit the Equity Release Interest Rates

Inheritance Tax Planning

Using equity release in conjunction with broader estate planning strategies to maximise the financial legacy for beneficiaries and minimise tax liabilities.

Single vs Joint Plans

Options to take out equity release on your own or jointly with a partner, impacting the repayment trigger (e.g., upon the death of the last named borrower) and overall financial security.

Home Modifications

Using released equity funds to pay for necessary adaptations—such as stairlifts, accessible bathrooms, or ramps—facilitating better quality of life and independent living.

Flexible Payment Options

Modern equity release plans increasingly allow for one-off or regular repayments, reducing interest and managing the total debt more effectively.

Equity Release Calculator

An online estimation tool used to very quickly project the potential cash available for release based on property value, age, and other relevant factors—a useful step ahead of formal advice.

Learn More: Is Equity Release the Right Choice For You?