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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

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

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

Mr & Mrs R - Coventry, West Midlands

I liked the fact there is a system where the customer can keep track of their application. I got the feeling the smaller... READ MORE

Mr & Mrs M - Sutton Coldfield

All very helpful. What I really like is that they always respond quickly to any question you may have and nothing is too... READ MORE

Miss K - Liskeard, Cornwall

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

The process was made very easy and went through so quickly. We were very impressed as any worries we had, were quickly covered. ... READ MORE

Mr W - Broxburn, West Lothian

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

Marc Cookson was very knowledgeable & provided us with excellent service. He was a delight to deal with. My comments are... READ MORE

Mr B - Chesterfield, Derbyshire

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

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

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

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

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

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

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

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

Mr & Mrs Barrett - East Sussex

Derek was very professional & efficient. He was able to sucessfully deal with our idiosyncrasies.

Mr & Mrs B - Fleet, Hampshire

We actually spoke to five companies re equity release. Equity Release Supermarket was head & shoulders above the rest. The... READ MORE

Mr & Mrs E - 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

This could not have been easier. A pleasure to deal with & not overbearing unlike competitors who bombarded me! This is the... READ MORE

Mr & Mrs L - Hull, Humberside

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

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 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

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

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

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

Mr W - Knebworth, Hertfordshire

A well-oiled service! Very professional and good service. My adviser was always there when I needed information and help. ... READ MORE

Mr H - Milford Haven, Pembrokeshire

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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