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Frequently Asked Questions
These are some answers to common equity release questions we get on a regular basis.
Our assistant will happily answer any further questions once you apply via our form.
Equity release is a way to help people over 55 release the money in their home (the equity) without having to move or sell.
The amount of money you can get depends on your age and how much your house is worth, minus any money you owe on your existing mortgage, if you still have one.
A Lifetime Mortgage is the most common form of equity release. This is a loan secured on your property but unlike a normal mortgage you do not have to repay it in your lifetime. It is usually only repaid when you die or go into long term care.
The No Negative Equity Guarantee means you’ll never owe more than your property is worth and no debt will ever be passed on to your relatives when you die or go into long-term care.
The money you can release from your home is tax free although it may affect your entitlement to certain state benefits.
A lifetime mortgage is a type of equity release scheme available to homeowners aged 55 and over. It allows you to release tax-free cash from the value of your property while retaining ownership.
With a lifetime mortgage, you borrow against the value of your home, and the loan plus interest is repaid from the sale of your property when you die or move into long-term care.
To be eligible for a lifetime mortgage, you must be a homeowner aged 55 or over with a property valued above a certain threshold, typically £70,000.
Yes, you can; you’ll just need to repay it with the money you release.
People choose to top up their income, gift money to family and friends, make home improvements or alterations, pay off unsecured debts, or take that worldwide cruise.
The amount you can release depends on factors such as your age, property value, and lender criteria. Typically, you can release between 30% to 59% of your property’s value and typically, the older you are, the more cash you can have access to.
You can take a single lump sum or you can draw the money down as and when you wish in instalments or a combination of the two.
Interest on a lifetime mortgage is normally fixed for the term of the mortgage.
While you’re not required to make monthly repayments, some lifetime mortgages offer the option to make voluntary payments to reduce the overall debt.
Interest on a lifetime mortgage is added to the loan amount, increasing the overall debt. This is known as a “roll-up” mortgage.
Yes, you will still own your home with a lifetime mortgage. The lender will place a legal charge on your property, but you retain ownership until you sell or move out.
A lifetime mortgage can reduce the value of your estate, potentially impacting the inheritance you leave behind for your loved ones. Most lenders however offer an inheritance guarantee which safeguards a percentage of your property’s equity for your loved ones.
If you decide to move, you can usually transfer your lifetime mortgage to a new property, subject to lender approval.
Yes, you can repay a lifetime mortgage early, but early repayment charges may apply. It’s essential to check your lender’s terms and conditions.
Yes, lifetime mortgages are regulated by the Financial Conduct Authority (FCA) to ensure consumer protection. It’s essential to work with a regulated advisor and lender.
Fees may include arrangement fees, valuation fees, legal fees, and advisor fees. These costs can vary between lenders, so it’s important to understand the fee structure before proceeding. Most, if not all of these fees can be paid out of the proceeds of the mortgage.
The timeframe for setting up a lifetime mortgage can vary depending on factors such as the lender’s processes and your individual circumstances. It typically takes several weeks from application to completion.
If you outlive the mortgage term, the loan plus accrued interest will be repaid from the sale of your property when you die or move into long-term care. Any remaining equity belongs to you or your estate.
Paul Hart is a qualified and independent financial advisor specialising in equity release. He can help you understand your options, compare products, and make informed decisions tailored to your needs and circumstances.