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How does equity release work?

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Checked for accuracy and updated on 27 June 2023

Equity release allows homeowners over the age of 55 to unlock the value of their property without the need to sell or downsize.

In principle, equity release schemes come in two formats:

Lifetime mortgages are a type of mortgage secured on your property which can be your main residence, second home or even a holiday home.

Homeowners continue to own their home and can choose either a single cash lump sum, income or take smaller chunks of money over time – known as drawdown. All the money released is tax-free and the homeowners get to stay in their property until they die or go into long-term care.

The money raised from any equity release scheme can be used for any legal purpose: from home improvements to clearing existing debts or mortgages.

And if it’s just some extra funds needed to buy a new car or a once-in-a-lifetime trip, that’s fine too – we never tell you what to do with your money.

Or

Home reversion plans allow you sell a percentage of the value of your property in return for a tax-free cash lump sum, or series of capital amounts. The home reversion provider offers a lifetime tenancy to the homeowners, enabling them to live rent free in their home for the rest of their lives.

Although home reversion has a minor role in today's equity release market, they still provide peace of mind as a way of releasing tax-free cash AND guaranteeing an inheritance for your beneficiaries.

What’s the equity release application process?

At Equity Release Supermarket, we provide a transparent and customised service which sees our experienced and friendly advisers guide you through the whole application process. From initial research to the successful release of funds at completion, you can rely on our team to explain everything in a language that’s easy to understand.

Here is a guide to explain the equity release application process:

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1 Advice and recommendation

The first part in the equity release process is to have a free initial consultation with one of our advisers. They will provide you with a personalised suitability report based on your circumstances and products currently available in the market.

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2 Application

Following acceptance of our recommendation, your equity release adviser will complete an application form, collecting supporting documentation and identification. Our new business team will then forward your file onto the equity release provider.

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3 Valuation report

Upon receipt of your application, the lender will instruct a local independent surveyor to contact you and arrange a mutually convenient valuation of your property. The surveyor will conduct a market appraisal, advising its current value and condition for security purposes. The outcome of this report will determine how much equity can be released.

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4 Conveyancing and legal

Your appointed equity release solicitor will be responsible for dealing with the legal process. They will liaise with the lenders’ solicitor and fill out an initial questionnaire about you and your property. You will then receive an offer from the lender, along with a Solicitor's Certificate.

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5 Offer made

Once the lender deems the surveyor’s valuation report satisfactory, you will be sent an equity release offer. This confirms the terms and conditions of the mortgage, including the rate, charges and amount borrowed. The original offer is sent to your solicitor, requiring a signature in the presence of your solicitor during a face-to-face meeting.

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6 Completion

Finally, when the lender’s solicitors have completed their final checks of all the legal paperwork, they will set a completion date. The funds released are sent to your solicitor initially with any charges deducted. Dependent upon your preferences, the net amount will then be forwarded to your nominated bank account or posted via cheque.

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7 Enjoy the proceeds!

With the funds released, you are now free to spend the equity release proceeds in whatever way you wish. Equity Release Supermarket prides itself on service, so we will always try to check-in on an annual basis to make sure the plan remains competitive.

What our happy customers have to say about our equity release advisers

All options very well explained, and Adam was very patient.

Mr & Mrs B - Hailsham, East Sussex

Your website is the best I could find on the web. With an abundance of useful information, most of which was absent on other... READ MORE

Mr N - Cranbrook, Kent

Always a traumatic time to find yourself on your own having lost your partner of many years. Feeling quite fit and healthy... READ MORE

Mrs H - Hartlebury

This service was fantastic. We were having problems getting equity release due to our solar panels. Mark sorted it out exteremely... READ MORE

Mr T - Nottingham

Gary was very persistent and helped us get the best rate where others had failed. The case had a few obstacles and the service... READ MORE

Mr and Mrs M - Kings Lynn

Marc Cookson explained things simply and correctly. Could not have done the job any better.

Mr R - Skipton, North Yorkshire

I want to say thanks for the excellent service I received, Jo gave me help and advice with a smile.

Mrs F - Camberley, Surrey

Mark,Thank you so much for arranging the Just Retirement Lifetime Mortgage for me. When you see yourself running out of... READ MORE

Mr M - Worthing, Sussex

The whole process was easy to understand throughout and the time from application to receiving our funds was very quick with... READ MORE

Mrs C - York

We knew nothing about Equity Release at the start, but after contacting Liam, he explained everything and guided us through... READ MORE

Mr & Mrs P - Newport

I cannot recommend Sara highly enough – dealt with her for the last 10 years. She is not only a fantastic person to partner... READ MORE

Mr and Mrs M - London

Haydn was very professional, he identified an appropriate solution rather than trying to sell a product.

Mr & Mrs H - Ashford, Surrey

Please convey a big 'thankyou' from my wife and I to Gareth Humphreys for the friendly, yet professional manner with which... READ MORE

Mr & Mrs P - Wakefield, Yorkshire

Tara was brilliant, very knowledgeable, understanding and helpful. I would and will highly recommend to anyone who wants... READ MORE

Ms N - Wigan, Greater Manchester

‘John’s patience and clear explanations provided us with the reassurance that we had made the right decisions’

Mr & Mrs Barrett - East Sussex

I would like to thank Derek Wren for the very professional way he managed my case. His manner gave me great confidence.

Mrs M - London

Deciding who to trust with such an important financial decision is daunting. Rebecca looked after us from our first enquiry... READ MORE

Mr & Mrs M - Leeds

Anna was superb in helping us through the minefield of equity release. I would seriously recommend her to anyone who wants... READ MORE

Mr N - Suffolk

The process was explained very well - with researched options. Listened to my requirements & offered suitable options. Very... READ MORE

Mrs S - Hordle, Hampshire

Everything very efficient, especially my adviser Andrew Ross. Considering we are under lockdown, it couldn't have been better.... READ MORE

Mrs D - Torquay, Devon

Daniel was really informative and didn’t put any pressure on us to make a decision

Mr & Mrs S - Sheffield, South Yorkshire

A huge thank you to Paul and Collete for their hard work, patience, and regular contact during the process of obtaining equity... READ MORE

Mr & Mrs S - Hull

Our adviser - Paul Newsome went way beyond the call of duty to get us our money and we can only be really thankful to him... READ MORE

Mr & Mrs S - Louth, Lincolnshire

Mr Young was very polite, informative and gave very clear information. He explained why he was asking various questions,... READ MORE

Mr and Mrs S - Bath, Somerset

Despite the limitations imposed by Coronovirus, I was extremely pleased by the highly professional approach adopted by all.... READ MORE

Mr W - Knebworth, Hertfordshire

Fantastically looked after throughout & left me with a great plan. Claire made certain that this was the best product for... READ MORE

Mr & Mrs A - Canterbury, Kent

Sue appreciated that we had carried out extensive research ourselves so was able to aim our discussions at the appropriate... READ MORE

Mr & Mrs H - Morecambe, Lancashire

A clear straightforward and quick process knowing exactly what costs were involved through set fees rather than %. Our thanks... READ MORE

Ms W - Irvine, North Ayrshire

My wife & I were very concerned that we would not be able to understand all that came with this equity release & had to rely... READ MORE

Mr & Mrs P - Braintree, Essex

How long does the equity release application process take?

A lifetime mortgage scheme usually takes somewhere between 4 to 6 weeks to complete, while a home reversion plan is more like 8 to 10 weeks, assuming the title on the house is clear. How long this takes will also depend largely on how efficient and experienced your solicitor is.

Applying for equity release involves legal work, which should be handled by a solicitor with expertise in equity release. This can help to avoid any potential delays in your application.

Equity Release Supermarket can provide a panel of qualified equity release solicitors to choose from, who can handle your application. All these solicitors offer a home visit if required and a competitive pricing structure, backed up by a 'no completion, no fee' guarantee.

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