Releasing equity from your home is a big decision and one you should discuss with a qualified adviser and the people closest to you. It is becoming a popular option for people who want to maintain a certain quality of life after their retirement or have debts to pay off or home improvements to make. There are options and plans out there for all financial situations but we wanted to flag up some important questions you should consider before you start the process.

About you

Are you over 55 (lifetime mortgage or 65 (home reversion plan)?
Do you own your own home?
Do you live in the UK?
Is the property your main residence?
Do you know how much money you want to release?
Have you discussed your plans with your family?
Are you aware that releasing equity could affect any state benefits you receive?

Lifetime mortgage or home reversion plan

Does a drawdown or lump sum lifetime mortgage suit you better?
Are you aware of interest-only lifetime mortgages which allow you to keep the amount of the loan at the amount borrowed for the whole term of the loan?
Did you know you can switch your plan to one with a more competitive rate if you’re not happy?

Costs

Have you set aside funds to pay the arrangement fees? These can typically be around £1,000-£3,000.
Do you have an existing mortgage which will need to be cleared with existing funds or through releasing equity?
Are you aware that interest can roll up fast?

The future

Have you checked if there’s an early repayment charge if you change your mind?
Are you aware that equity release can impact the inheritance you pass on to family and friends?
Do you know what happens when you die or enter long-term residential care?

Financial adviser

Is your financial adviser on the Financial Conduct Authority register?
Are they a member of the Equity Release Council and on its directory?
What are your adviser’s fees?

Is there another option?

Would selling your home or downsizing solve any financial issues?
Could you borrow money from elsewhere instead?

:: Use our Equity Release Calculator to work out how much cash you could release.

It is important to take expert advice on equity release before deciding whether it is right for you. Contact us to find out more from one of our highly trained advisors.