How much can I access with Equity Release?

The value of accessible funds and how they can be used are key considerations when contemplating Equity Release in the UK. Here, we explain how lenders evaluate the amount you can unlock from your home, and what you can do with the funds.

How is the amount determined?

The amount you can unlock from Equity Release depends on several factors, including:

• Homeowner’s age - products are usually available from age 55 and borrowing limits increase with age. So, often the older you are, the more you can borrow.

• Property value - as expected, the greater the value of your home, the greater the potential Equity Release amount.

• Health - some lenders offer enhance Equity Release options for certain health conditions. In this case, there is potential to borrow more.

• Lender criteria - different lenders have loan-to-value (LTV) limits and evaluate risk.

What is a typical amount to release?

Depending on the above factors, most homeowners can release between 20% and 60% of their home’s market value. So, a property worth £400,000 could, for example, provide for an Equity Release of between £80,000 and £240,000.

To find out more about your own home and specific circumstances, we advise speaking with one of our Equity Release specialists.

How can you use the funds?

Equity Release offers significant flexibility to use your funds as you wish, including for:

• Home improvements and renovations, for example to enhance your accessibility.

• Increasing your retirement income and financial comfort.

• Offering your loved ones financial support, such as helping your child with their first house deposit.

• Clearing debts to reduce financial burden.

• Enjoying your retirement, hobbies and travel opportunities.

Important considerations:

• If unpaid, the interest will compound so the debt can accumulate significantly over time.

• The loan is repaid from the sale of your home which could impact your family’s inheritance.

• Some plans charge early repayment fees, should you decide to repay the loan early.

• Access to equity release may impact your eligibility for means-tested benefits.

Is Equity Release Right for You?

Equity release can be a valuable financial solution for those looking to improve their retirement lifestyle. However, everyone is different, and it is important to understand how it works. It is essential to seek financial advice to help you make an informed choice that aligns with your goals and financial security.