An equity release mortgage is when you use the value of your home to generate a cash lump sum, or a regular income. It's only available to older homeowners.

It turns out the money you have tied up in your property (known as equity) can be converted into a tax-free cash lump sum or monthly income. You'll sometimes hear it being called an equity loan or home equity loan.

With a home equity release mortgage, you're withdrawing money from the value of your home, but you don't have to move or sell your property. And sometimes you don't even need to pay back mortgage interest while you're still living there.

It can be helpful to older people, aged 55 and over, who've paid off their mortgage. Perhaps they want extra money to boost their pension or standard of living, but they don't want to move out of the family home.

If you're wondering 'how much equity can I release?' then you can use an equity release calculator to work out how much cash you can free up from your property.

With equity release, under 55 year olds aren't the right candidates. An equity release mortgage isn't the same as a remortgage to release equity.

Learn more about equity release schemes.

What's an equity release calculator or lifetime mortgage calculator?

An equity release calculator is a tool you can use to work out how much tax-free cash you can free up from your property. If you don't know how much house equity you have, there are home valuation tools you can use online.

An equity release calculator can show you useful information about your specific situation. It could help you decide whether an equity release mortgage is something you'd like to go ahead with or not. A lifetime mortgage calculator does the same thing.

If you're considering releasing equity from your home, our comparison table above will also be useful to you. It shows you the size of the loan you can get, the loan to value (LTV) ratio and the equity release rates. Plus you can check which you're eligible for.

How to find the best equity release mortgage

If you're looking to compare equity release options and find the best equity release rates, use our comparison table above. It'll help you find an equity release mortgage that works for you.

Once you've decided which you think is the best equity release mortgage for you, click 'check eligibility' and complete the enquiry form. You'll then be contacted by a mortgage adviser who will ask about your financial situation and discuss your options.

What type of equity release mortgage should I choose?

There are different types of equity release schemes. The type you should choose depends on your personal financial situation.

It can be useful to get some proper equity release advice as part of the process, to help you make the right decision.

What types of equity loans are there?

There are two main types of property equity release mortgage.

A lifetime mortgage is when you get a lump sum secured against your home. It's paid back, with interest, when your home is sold. With a lifetime mortgage, you still own all of your home. The interest continues to go up until your property's sold.

A home reversion mortgage is when you sell all or part of your home to a provider, in return for a lump sum or monthly income. You'll be able to continue living in your home - rent free - for the rest of your life.
You'll need to decide whether a home reversion plan or lifetime mortgage is the best option for you. It's a good idea to get some equity release advice to help you choose which type of equity housing loan you should go for.

An independent financial advisor will talk to you about how to release equity from your home. They'll also talk to you about the costs and benefits, as well as the pitfalls of equity release. And they can recommend which they believe is the best equity release company for you, as well as which equity release companies to avoid.

You'll have a lot to think about if you want to release equity from house assets.

Find out more about lifetime mortgages and home reversion schemes

Am I eligible for an equity mortgage?

This depends on your situation and equity release companies are all different with different criteria. Equally, every home equity loan, UK wide, is different.

But generally, all equity release companies will need you to:

  • Own your own home, usually with no outstanding mortgage

  • Be 55 years old or more, but some schemes have a higher minimum age

  • Have your home in good condition.

Find out who can use equity release schemes to see if you're eligible.

With equity release, under 55 year olds aren't the right candidates. But, if you have home equity that you'd like access to, you could think about a remortgage to release equity. This is one of the alternatives to equity release mortgages if you fall into a younger age bracket.

What are the pitfalls of equity release mortgages?

Everyone's financial situation is different. If you're wondering 'Is equity release a good thing?' then it depends on your situation. You should remember that an equity release mortgage is a lot more complex than an ordinary mortgage.

Some of the disadvantages include:

  • If you're releasing equity from your home then it means your family won't inherit all of it. Instead, the equity release company may end up owning some or all the property.

  • There are several costs that come with equity release and this can affect the benefits you receive.

  • If you take out an equity release mortgage when you're 55, and then live until you're in your eighties or older, you'd incur a big debt over the years. If you're hoping to pass on your home to your family or heirs, this is worth thinking about.

Read more about the benefits and risks of equity release.

Here are a few things to look out for when choosing an equity loan.

  • Equity release interest rates. When you're comparing deals, watch out for equity rates. You should be looking for a deal that's fixed or capped for the lifetime of the equity loan. With lifetime mortgage rates you can avoid any nasty surprises if interest rates rise.

  • A no negative equity guarantee. A good equity loan should have a 'no negative equity guarantee'. This means your family won't have to pay back more than the value of your property when it's sold after you've died.

  • Interest payments. Check whether your equity loan lets you repay some of the interest as you go along. In the long run, this makes the cost of equity release lower overall.

  • Minimum withdrawal sum. See if there's a minimum sum you can withdraw each month, or a minimum lump sum. This'll help you work out the total cost of what you're paying to access your equity.

  • Regulated companies and schemes. When you're looking at equity release companies, look for schemes that are approved by the Equity Release Council (ERC). Also look for equity release providers that are regulated by the FCA (Financial Conduct Authority). You can check their register to find out.

How do I know what good equity release interest rates look like?

With our equity loan comparison table at the top of this page, you can compare your options for equity release, UK wide.

Compare equity release interest rates and maximum LTV to find the best equity release deals.

If you click 'check eligibility' you can also see if you're suitable for the loan. And you can get quotes from equity release advisers who could give you expert equity release advice.

It's very important that you understand the features and risks of different equity release loan products. This'll help you to make sure you're getting an appropriate equity release mortgage for your financial situation.

How do I get equity release advice?

You might be wondering how to find equity release advice.
Equity release brokers can offer helpful advice before you sign up for an equity release mortgage. These are complex products.

It's a good idea to use equity release advisers for this kind of product, to make sure you fully understand what you're doing. You need to be clear about the effect that this type of mortgage will have on the equity you hold in your home. You'll also need to look at the amount of equity that you'll be able to pass onto your family.

Use our enquiry form to get a personalised mortgage quotation.

Doing a remortgage to release equity


Another way you can access the money in your home is by doing a remortgage to release equity. This isn't the same as an equity release mortgage.
With a remortgage to release equity, you're taking out a lump sum from your property and paying interest on the amount that's outstanding.
You'll usually have the option to repay the loan in full or make additional repayment contributions.
When you remortgage to release equity, if you keep up the repayments and pay off your mortgage in full, the lender has no right to a share in your home.
However, a remortgage to release equity may not be an option for older people. Have a look at our remortgage comparison page to see the deals on offer.

Equity release FAQs

Q

Should I get financial advice?

A

You can get advice and a lifetime mortgage quote from a broker. You can decide what option is best by contacting an independent financial adviser.

Q

What are the alternatives to equity release?

A

You could raise money by moving to a smaller home, or getting a loan. A financial adviser could help you decide.

Q

How much can I get from equity release?

A

This can depend on your age, your property's value, the scheme you use and how much equity you sell.

About our mortgage comparison

Q

Who do we include in this comparison?

A

We include mortgages available through our independent broker, Responsible Equity Release. They are all from lenders regulated by the Financial Conduct Authority. Here is more information about how our website works.

Q

How do we make money from our comparison?

A

We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.
You do not pay any extra and the deal you get is not affected.