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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

Dave was a great guy. He put me at ease straight away and was very patient and understanding, explaining everything very... READ MORE

Miss G - Ellesmere Port, Cheshire

I thought this process would be quite complex & a little invasive, but the adviser was very clear & explained things very... READ MORE

Mr W - Stone, Staffordshire

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

I want to thank Haydn for my excellent guidance throughout the process. I felt heard and supported all the way through and... READ MORE

Mr H - Leeds

We both found the experience straight forward thanks to the detailed advice given by Gareth and the rest of the people assigned... READ MORE

Mr & Mrs T - Hull, Humberside

My telephone call with my advisor Rebecca was very informative. She was friendly, professional and laid everything out to... READ MORE

Ms B - Fife

Anna was friendly, helpful, patient with our endless questions and made everything easy, including the legal stuff.

Ms C - Devon

Adam is very knowledgeable on the matter we raised, and his explanations were very clear and easy to understand.

Mr & Mrs G - London

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

A well-oiled service! Very professional and good service. My adviser was always there when I needed information and help. ... READ MORE

Mr H - Milford Haven, Pembrokeshire

The reason I chose this company was their clear & informative website. It was the only one I could find that gave examples... READ MORE

Ms C - Guildford, Surrey

I don't know if there are others like Derek, but the company is well represented by him. A job well done.

Mr & Mrs F - Chingford, Essex

A total pleasure to deal with, thank you so much for finding us the perfect product! Nothing but complete professionalism... READ MORE

Mr & Mrs T - London

Sara Whitbread provided an excellent service. She enables us to find the perfect offer & the whole process was handled swiftly,... READ MORE

Mrs A - Hereford, Herefordshire

Excellent and professional service. Stuart Young was very helpful and explained everything in a knowledgeable and friendly... READ MORE

Mr P - Newby Bridge, Cumbria

Full & comprehensive information provided together with close contact throughout the process. Very prompt turnaround following... READ MORE

Mr & Mrs T - Carnforth, Lancashire

David McGirr was very professional and helpful throughout the process. He always replied to emails and phone calls.

Mr F - Aberdeen, Scotland

Mark was very upfront with our questions and answered honestly and in a friendly manner.

Mr & Mrs G - Ashford, Kent

I cannot recommend Paul highly enough and would have no problem recommending him if someone is considering equity release.... READ MORE

Mr J - Ely, Cambridgeshire

Andrew was very friendly & professional. He provided a clear explanation of the process. His advice was succinct & considered.... READ MORE

Mr W - Dartmouth, Devon

My Adviser offered me a range of products that could be suited to what I was specifically looking for. This enabled me to... READ MORE

Mr A - County Durham

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

Gary was very clear with his explanations and helped us understand all our options. Everyone involved was very helpful and... READ MORE

Mr and Mrs R - Canterbury

Extremely responsive to our requirements, especially as ours were slightly non-standard. Allen provided a range of options... READ MORE

Mr N - Dorset

Anyone thinking of using equity release from their home, I could not recommend ERSupermarket highly enough. From the initial... READ MORE

Mr & Mrs P - London

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

Mr R - Skipton, North Yorkshire

‘In these uncertain times, John's support and extensive knowledge have been outstanding. My husband and I have previously... READ MORE

Mr & Mrs J - Cardiff, Wales

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

Mrs F - Camberley, Surrey

All very helpful. What I really like is that they always respond quickly to any question you may have and nothing is too... READ MORE

Miss K - Liskeard, Cornwall

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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