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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

Very happy with the presentation and advice by our adviser - Gary Webster. He was business like, polite and happy to meet... READ MORE

Mr & Mrs P - Romford, Essex

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

Mr W - Knebworth, Hertfordshire

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

Guy was our Lifetime Mortgage Advisor, we cannot speak highly enough of him, he helped us through the whole process step... READ MORE

Mr & Mrs C - Newcastle

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

Mr & Mrs B - Hailsham, East Sussex

Equity release gets bad press, but the flexible loan is perfect for me. I feel very secure & very pleased it is still my... READ MORE

Mrs S - Kidderminster, Worcestershire

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

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

Your adviser, Hannah Boxshall, was the only one who actually visited me to discuss equity release details. She gave me outstanding... READ MORE

Mr L - High Halstow, Kent

Excellent Service. Mark was very helpful & always returned calls very quickly if unavailable. We were always kept upto date... READ MORE

Mr & Mrs W - Redditch, Worcestershire

‘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

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

Very easy, very helpful, excellent service. Our adviser Allen Tomlinson was very clear with all his advice & explained everything... READ MORE

Mr & Mrs M - Hailsham, East Sussex

Completely unbiased and well explained. Easy to understand.

Mr & Mrs L - Doncaster, Yorkshire

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

David took his time going through the different scenarios that were open to my situation. Very professional and quick.

Ms Y - Haddington, East Lothian

Before actually ringing, I was very concerned about how stressful the whole procedure would be. Marc made it clear from... READ MORE

Mrs C - Exmouth, Devon

Dan was very polite and professional. He took his time to really understand what we were looking to do and took onboard any... READ MORE

Mr & Mrs F - Skipton, North Yorkshire

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

The adviser was very thorough in explaining the process & his recommendation. Derek went through all the options & alternatives... READ MORE

Mr & Mrs K - Enfield, London

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

A smooth episode all-round, which could have been so much more fraught, being a quite complex operation.

Mr & Mrs G - Lowestoft, Suffolk

Very efficient polite and quick. Kept me informed every step of the way.

Ms R - Bicester, Oxfordshire

Very helpful, efficient & all went smoothly. Rob was very professional & helpful at all stages of the process.

Mr & Mrs P - Southampton, 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

I personally dealt with Chris during a remortgage transaction. He displayed a "Can Do' attitude. Consistently warm and friendly... READ MORE

Mr & Mrs C - Gwynedd, Wales

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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