What is Equity Release?

What is Equity Release?

Equity Release is the term to describe Lifetime Mortgages and Home Reversion Plans.

“What is Equity Release?”, is a question many people are asking. If you’re a homeowner aged over 55, Equity Release could help you to unlock, free – or ‘release’ – equity from your home, so that you’ve got extra cash to spend on the things you want or need.

‘Equity’ simply refers to the difference between what your property is worth and any outstanding loans, such as a mortgage loan secured on the property. More people than ever are now considering Equity Release because of factors including: cut-backs in state pensions, inadequate private and company pensions, longer life expectancy and improved Equity Release regulations. For many people though, they just want to improve their quality of life.

To find out how much equity you could release from your home try our Equity Release Calculator.

For example:

  • Your house is worth £150,000. You have retired and paid off all your debts, including the mortgage. 
    Your equity is £150,000.
  • You bought your house for £100,000 with the help of a mortgage of £80,000. The value of the house is now £200,000 and the outstanding mortage is £10,000. 
    Your equity is £190,000.

It’s entirely up to you what you spend the money on and how you receive it – you might want a one-off lump-sum or you might choose regular instalments.

What is Equity Release?What is Equity Release?

Some popular uses for the funds are:

  • Home improvements (new conservatories, central heating, double glazing repairs, garden improvements)
  • Clear debts (mortgages, credit cards,
    loans, reduce outgoings)
  • Holidays, cruises and short breaks
  • New cars, caravans, holiday homes
  • Family treats (grandchildren’s school 
    fees, gifts)
  • Improve retirement or enable early retirement
  • Private medical care or mobility items (scooters, stair lifts)
  • Visit family or friends overseas
  • Help children onto the property ladder or to reduce their mortgage
  • Reduce liability to inheritance tax

Mr & Mrs Eldridge

Rochester

“Matthew was very thorough when explaining things to us and made the whole process easy!”

Mr & Mrs Mitchell

East Sussex

“Mark was very informed, professional and
non-judgemental. Sound advice all-round!”

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