How to release equity from your home
For many UK homeowners, equity release is a useful way to supplement income, repay debts or make life easier for loved ones.
What is equity?
In its simplest terms, house equity is the value of how much of your home you own.
So, if the outstanding balance of your mortgage is £250,000 and the value of your property is £300,000, then you have £50,000 equity in the property.
Or to put it another way, your equity consists of any deposit you paid on your house purchase, plus the amount you’ve already paid off your mortgage as well as any increase in the value of your home since you purchased it. If your mortgage has been paid off completely, then you will have 100% equity.
Why release equity from your home?
Equity release is an increasingly popular way to access more cash in retirement and there are a number of benefits of equity release. For example, you might want or need to:
- Help younger generations onto the property ladder
- Supplement your pension
- Pay off debts
- Meet an unexpected expense
- Carry out home improvements
- Improve your lifestyle
Equity release allows you to dip into the wealth you’ve accumulated in your property to cater for these expenses, without the upheaval of moving home.
How to release equity from your home
You can release equity from your home with one of the two types of equity release products: lifetime mortgages and home reversion plans. Lifetime mortgages offer greater flexibility to a wider range of customers and for the purposes of this piece, we will focus on them.
A lifetime mortgage is a complex product and can only be taken out through a professional, regulated adviser. Although lifetime mortgages are complex products, the process of obtaining one can be broken down into 7 key stages:
To find out more about the cost and duration of the equity release process, read our articles How much does equity release cost? and How long does equity release take?
Can I release equity from my home?
This quick checklist will help you find out if you qualify for equity release. You must be:
- Aged 55 or over
- Living in your own home
- Looking to borrow a minimum of £10,000
- A resident of England, Wales, Scotland or Northern Ireland
- Own a home worth a minimum of £70,000
Speak to us
Find out more about how to release equity from your home. In a free initial consultation, where we can answer any questions you may have.
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Try our equity release calculator
See how much equity you could release by entering your details below.
Maximum loan amount:
Important: The loan amounts above are an illustration of the amount you could borrow. The actual amount may vary depending on your individual circumstances. The figures are not guaranteed and do not constitute an offer to lend. The loan amount will need to pay off any existing mortgage secured against the same property.
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