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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

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

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

Guy was very thorough. He explained everything fully. He's friendly and very easy to talk to. I would definitely recommend.... READ MORE

Mrs E - Shrewsbury

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

Mr H - Bolton, Lancashire

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

Mrs B - Plymouth, Devon

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

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

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

Mr & Mrs Barrett - East 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

I have enjoyed speaking to Gareth. He is a very nice and friendly person and he is an asset to your company. The whole... READ MORE

Mr & Mrs B - Stockport, Cheshire

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

We were so impressed with the professionalism and attention given to our needs by Hayley who handled our case from beginning... READ MORE

Mr & Mrs H - London

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

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

Mr & Mrs G - 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

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

Mrs F - Camberley, Surrey

Mark was brilliant, experience was very comfortable and very easy.

Mrs B - Bolton, Lancashire

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

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

Ms R - Bicester, Oxfordshire

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

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

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

Ms C - Devon

Stuart was very clear about how equity release might benefit me, but at the same time he explained there were other ways... READ MORE

Mrs B - Edinburgh

Contact with Marc Cookson was always very easy. He handled all my questions very clearly and very soon made me realise that... READ MORE

Mr & Mrs C - Market Harborough, Leicestershire

The service provided & information available was excellent which allied to a very informed & personable advisor made the... READ MORE

Mr S - Moreton In Marsh

All was excellent! All went through quickly and painlessly. I so appreciate the care and patience that was taken with me... READ MORE

Mrs H - 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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