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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

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

Mr R - Skipton, North Yorkshire

Stuart Young was efficient in the way he explained the numerous options available to me. I never felt under pressure and... READ MORE

Mrs T - Winchester, Hampshire

The service I received was extermely professional. The process was uncomplicated & well informed. I would recommend Equity... READ MORE

Miss W - Lewes, East Sussex

Very friendly, explained everything as we went through, and not in a hurry. I would recommend to friends and family.

Mrs T - Stockport, Cheshire

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

Mr W - Dartmouth, Devon

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

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

Mr & Mrs S - Sheffield, South Yorkshire

Nothing is 100%, but boy this was close! This is a first class professional unit. They explained, outlined & covered all... READ MORE

Mr & Mrs C - Beckenham, Kent

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

Anna was empathetic to our requirements and her advice and recommendations helped to clarify our decision.

Mr C - Rochdale

From first meeting to cash in the bank took just 28 days. Much faster than I could have expected.

Mr H - Richmond, Surrey

I really felt like I was dealing with a professional who knew what I wanted and needed. My options were clearly explained... READ MORE

Mrs A - East Lothian

I can't fault Allen Tomlinson's advice, manner, contactability and professionalism. I would have no hesitation in recommending... READ MORE

Mr Q - Folkstone, Kent

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

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

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

Mrs F - Camberley, Surrey

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

Mr & Mrs Barrett - East Sussex

It was a pleasure to deal with someone who tells you what will happen, and it actually happened and was so quick and straightforward.... READ MORE

Mrs C - Colchester

I found Mark Rumney to be clear, concise and courteous. Highly satisfied with all aspects of the services.

Mr & Mrs J - Powys, Wales

It's nice to be able to say that Gareth Humphreys, besides being very knowledgable & most patient, became a friend.

Mr W - Potters Bar, Hertfordshire

Sue was very clear and explanatory, considerate and understanding, friendly and reassuring.

Mr H - Bolton, Lancashire

Tara was an exemplary advisor in my case every step of the way. She spoke with clarity using language I could understand... READ MORE

Mrs D - West Sussex

Derek Wren provided an excellent professional service. He was courteous & patient at all times & maintained continuous contact.... READ MORE

Mr & Mrs M - Weybridge, Surrey

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

Mr & Mrs B - Hailsham, East Sussex

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

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

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

Excellent service from Liam Jenkins and team Thorough, responsive and very efficient. Everything moved at a good pace, much... READ MORE

Mr & Mrs M - Bedford

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

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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