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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

Equity Release Supermarket really got things moving with my application and business was concluded within two weeks of contacting... READ MORE

Mr H - Didsbury, Manchester

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

Hannah was excellent. Nothing was too much trouble. Equity Release Supermarket is lucky to have her.

Mr M - Sandwich, Kent

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

Ms B - Fife

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

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

We were very pleased with the professional and friendly approach from Allen and all the people involved in getting us on... READ MORE

Mr & Mrs S - Southampton

I am so pleased I chose Equity Release Supermarket, as the decision turned out to be the right one. Professional from the... READ MORE

Mr H - Hamilton, Scotland

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

What was a major decision for us to proceed was made much easier by the professionalism & quality advice provided by everyone... READ MORE

Mr & Mrs K - Harrogate, North Yorkshire

The service was excellent right through the process, Paul kept updated at all times, everything was explained, and independent... READ MORE

Mr & Mrs B - Norwich

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

Mr & Mrs Barrett - East Sussex

I received all of my advice with compassion, Haydn is a life saver, literally!

Mrs S - Chichester

Really good to talk with people who are understanding and not pressurising.

Mr & Mrs R - Coventry, West Midlands

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

Mr W - Knebworth, Hertfordshire

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

My advisor Liam Jenkins was outstanding. Thoroughly professional in all the questions he asked and forthcoming with advice... READ MORE

Mr T - Edinburgh

Sara has recently helped us with an equity release on my mum’s property. Not only was she professional & thorough, but... READ MORE

Mrs K - Brentwood, Essex

Our adviser - Sue Eastham was fantastic. Always available and nothing was too much trouble.

Mr & Mrs F - Bredbury, Gtr Manchester

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

Simply fabulous service. I would say that the help and advice I got from Claire was superb. Every effort was made to ensure... READ MORE

Mrs B - Fareham, Hampshire

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

Mrs T - Stockport, Cheshire

Excellent from beginning to completion. Andrew explained everything very clearly. Being able to initially do my own research... READ MORE

Mrs M - Exeter, Devon

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

Everything went smoothly from start to finish. Now looking forward to having my garden landscaped along with work inside... READ MORE

Mrs D - Alton, Hampshire

First class service from Tara, thank you.

Mrs M - Saltburn, 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

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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