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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

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

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

Ms B - Forest of Dean

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

We knew nothing about Equity Release at the start, but after contacting Liam, he explained everything and guided us through... READ MORE

Mr & Mrs P - Newport

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

Mr & Mrs G - London

Excellent service. Derek Wren explained everything we needed to know in a friendly manner.

Mr & Mrs C - Isle of Grain, Kent

‘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

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

Mr P - Newby Bridge, Cumbria

Very friendly, explained everything as we went through, and not in a hurry. I would recommend to friends and family.

Mrs T - Stockport, Cheshire

Compared to Age Partnership who we spoke to first re equity release, Simon's advice turned out much better. I feel Simon... READ MORE

Mr H - Stafford, West Midlands

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

Analysis of my situation intelligent & thorough. Advice given well reasoned & supported by evidence. Maintained friendly... READ MORE

Mr S - Folkestone, Kent

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

Mrs F - Camberley, Surrey

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

Mr & Mrs S - Sheffield, South Yorkshire

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

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

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

Ms C - 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

Our adviser - Sue Eastham was fantastic. Always available and nothing was too much trouble.

Mr & Mrs F - Bredbury, Gtr Manchester

Steve Sykes was very professional about giving us advice in a way we understood, patiently and step-by-step.

Mr O - Lound, Suffolk

The service I received was extermely professional. The process was uncomplicated & well informed. I would recommend Equity... READ MORE

Miss W - Lewes, East Sussex

A very caring & professional service. Always helpful & professional. Kind caring & considerate to all issues. Easy to contact... READ MORE

Mr M - Southampton, Hampshire

The financial adviser was proactive throughout the process, even when on holiday.

Mr B - Shrewsbury, Shropshire

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

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

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

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

A huge thank you to Paul and Collete for their hard work, patience, and regular contact during the process of obtaining equity... READ MORE

Mr & Mrs S - Hull

No high pressure selling. Mark was quite happy to wait a while before we made a decision. Easy to complete, fully professional... READ MORE

Mr & Mrs L - High Peak, Derbyshire

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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