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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

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

Mr H - Bolton, Lancashire

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 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

The whole process was easy to understand throughout and the time from application to receiving our funds was very quick with... READ MORE

Mrs C - York

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

Mrs F - Camberley, Surrey

We both found the experience straight forward thanks to the detailed advice given by Gareth and the rest of the people assigned... READ MORE

Mr & Mrs T - Hull, Humberside

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

Mr & Mrs G - London

We found Equity Release Supermarket, in particular Hannah Boxshall, who acted for us to be very efficient. The offers were... READ MORE

Mr & Mrs C - Sidcup, 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

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

Mr T - Edinburgh

Daniel was really informative and didn’t put any pressure on us to make a decision

Mr & Mrs S - Sheffield, South Yorkshire

Tara was an exemplary advisor in my case every step of the way. She spoke with clarity using language I could understand... READ MORE

Mrs D - West Sussex

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

Mr & Mrs H - Ashford, Surrey

From start to finish everything was explained very well. Very friendly staff, very professional indeed and would certainly... READ MORE

Mrs B - Blackpool, Lancs

Anna was empathetic to our requirements and her advice and recommendations helped to clarify our decision.

Mr C - Rochdale

Derek Wren provided an excellent professional service. He was courteous & patient at all times & maintained continuous contact.... READ MORE

Mr & Mrs M - Weybridge, Surrey

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

Mr P - Newby Bridge, Cumbria

‘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

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

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

Allen was very clear in his explanation and considerate to our needs. (My mum is 90 years old & the process can be quite... READ MORE

Mrs P - Bognor Regis, West Sussex

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 I dealt with was polite and friendly, easy to contact and kept me informed as things progressed.

Mr P - Polegate, East Sussex

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

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

Excellent, friendly & not pushy at all. Service from my local representative couldn't be bettered. Whole process was surprisingly... READ MORE

Mrs P - Paignton, Devon

David McGirr was very professional and helpful throughout the process. He always replied to emails and phone calls.

Mr F - Aberdeen, Scotland

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

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

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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