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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

I have nothing but praise for the excellent service that ERSupermarket has given me. The process of getting an equity release... READ MORE

Mr L - Portstewart

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

Mr W - Knebworth, Hertfordshire

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

Mrs F - Camberley, Surrey

Excellent service from Liam Jenkins and team Thorough, responsive and very efficient. Everything moved at a good pace, much... READ MORE

Mr & Mrs M - Bedford

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

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

Mr & Mrs Barrett - East Sussex

From the first meeting to the finalisation, everything went very well. Would definately recommend David McGirr.

Mrs E - Kelty, Fife

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

Mr C - Rochdale

No hassle, sensible advice, all issues covered. Made so much sense and very pleased.

Mr & Mrs A - Carlisle, Cumbria

Excellent, professional service, everything was done in a timely manner. calls happened when promised.

Ms B - Forest of Dean

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

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

Mrs B - Plymouth, 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

First class service from Tara, thank you.

Mrs M - Saltburn, North Yorkshire

Excellent advice and regular follow up throughout the whole process.

Mr W - Barnsley, Yorkshire

Great service with a customer focus - quick responses, comprehensive information and clear action plans carried through with... READ MORE

Mr D - Coulsdon, 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

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

Mr & Mrs B - Hailsham, East Sussex

Dave was a great guy. He put me at ease straight away and was very patient and understanding, explaining everything very... READ MORE

Miss G - Ellesmere Port, Cheshire

It's nice to be able to say that Gareth Humphreys, besides being very knowledgable & most patient, became a friend.

Mr W - Potters Bar, 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

Sue appreciated that we had carried out extensive research ourselves so was able to aim our discussions at the appropriate... READ MORE

Mr & Mrs H - Morecambe, Lancashire

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

Ms R - Bicester, Oxfordshire

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

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 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

Superb advice right from the start. Our wishes & concerns were taken fully into account when selecting the best product.... READ MORE

Mr & Mrs P - Fareham, Hampshire

Hannah was excellent. Nothing was too much trouble. Equity Release Supermarket is lucky to have her.

Mr M - Sandwich, Kent

Allen Tomlinson was first rate. We had many problems caused by Aviva & the valuer, but Allen remained calm and supportive... READ MORE

Mr M - Richmond-Upon-Thames

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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