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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

From first to last we were very impressed by your service & pleasantly surprised by how quick completion was, considering... READ MORE

Mr S - Hastings, East Sussex

Everything ran smoothly and quickly from start to finish. Highly recommended. Excellent service.

Mr & Mrs C - Sheffield, South Yorkshire

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

From the start of our enquiry to its fulfilment, we had great confidence in Marc, our adviser. He had obviously done a lot... READ MORE

Mr & Mrs D - Liverpool

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

Allen impressed from the start & proved to be most responsive & helpful when we hot some difficult challenges. Highly professional... READ MORE

Ms O - Salisbury, Wiltshire

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

Mr & Mrs B - Hailsham, East Sussex

Andrew was an excellent adviser, extremely patient and willing to visit on more than one occasion.

Mrs B - Plymouth, Devon

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

Hannah Boxshall was excellent. She took us through everything, was never pushy and was an absolute delight to deal with. An... READ MORE

Mr & Mrs B - Tadley, Hampshire

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

Mrs F - Camberley, Surrey

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

I am very happy with the service provided by Equity Release Supermarket. Many thanks to Sue for all the work she did to find... READ MORE

Mr P - Failsworth, Manchester

‘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

David was excellent with his advice & knowledge. We were kept well informed by David & Boyd Legal were 1st class.

Mr & Mrs F - Broxburn, West Lothian

Equity release was something I had looked into and Gareth provided a clear service. I had contacted Key Retirement, however... READ MORE

Miss S - Birmingham, Midlands

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

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

Mr P - Newby Bridge, Cumbria

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

Mr & Mrs H - Ashford, Surrey

Daniel, thank you so much for making this whole journey a pleasure. You were so understanding and thoughtful throughout and... READ MORE

Mr & Mrs N - Rhyl, North Wales

Steve Sykes was very professional about giving us advice in a way we understood, patiently and step-by-step.

Mr O - Lound, Suffolk

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

Compared to Age Partnership who we spoke to first re equity release, Simon's advice turned out much better. I feel Simon... READ MORE

Mr H - Stafford, West Midlands

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

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

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

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

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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