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Reasons for using equity release

Many people in retirement find their income no longer maintains their lifestyle or they need cash for an unexpected event or debt and turn to their property as a way of releasing equity.


According to the Equity Release Council the average age for equity release is 70 years taking a lump sum of approximately £78,000 with an average loan to value (LTV) of 27.6%.

In the first half of 2016 there were 11,846 new equity release plans taking £908 million from their homes, an increase of 28% over the same period in the previous year. Of the people accessing wealth in their home, one third was to take a lump sum and two thirds were to drawdown capital over time.

In a survey conducted by Just Retirement about why people use equity release typically there is not a single reason and they had a number of purposes for money either paid as a lump sum or income.

The main reasons people consider equity release and the percentage of those asked that said this is what they would use the money for are as follows:
Proportion of People
Main Reason for Equity Release
63% Home and garden improvements
31% Holiday of a lifetime
30% Pay off debts or personal loans
23% Help family members
22% Pay off interest only mortgages
16% Meet everyday expenses
Of those surveyed 63% of people use equity release to improve their home and this may also help to increase the value of their property. Paying off debts, personal loans and interest only mortgages were also popular reasons especially when these loans reached the end of their terms.

There are other more specific reasons why equity release is considered as follows:
Other Specific Reasons for Equity Release
Deposit on a property for children or grandchildren
If you are renting, to purchase a new home
To reduce equity for Inheritance Tax (IHT) planning
Pay university fees for grandchildren
Help their children start or expand a business
To pay for long term care
There are a number of popular types of equity release people can consider such as using a lifetime mortgage, drawdown lifetime mortgage or home reversion plan and these are very different in how they work.

Equity Release



Equity Release Best Buys

These are examples of equity release products we can approach with many more offering interest rates and flexibility to meet your needs.

3.19% Fixed Rate
Interest Roll-Up
15% Loan to Value
£0 Lenders Fee
3.24% AER
3.02% Fixed Rate
Interest Roll-Up
35% Loan to Value
£895 Lenders Fee
3.26% APR
2.76% Fixed Rate
Interest Roll-Up
20% Loan to Value
£599 Lenders Fee
2.90% APR
2.87% Fixed Rate
Interest Roll-Up
15% Loan to Value
£895 Lenders Fee
2.91% AER

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  • IMPORTANT

    Equity Release may involve a Lifetime Mortgage or a Home Reversion Scheme. To understand the features and risks, please ask for a personalised illustration. Equity Release may affect your entitlement to means tested state benefits and will impact on the size of your estate. For Equity Release London City Mortgages charge a fixed fee upon completion of £695. For Mortgages a fixed fee is charged on application. Typically this is from £295 up to £495 for the services selected.

  • WARNING

    Equity Release - Equity Released from your home will be secured against it. Mortgages – Your home may be repossessed if you do not keep up repayments on your mortgage or other loans secured against it. Think carefully before securing other debts against your home. The information contained in this website is subject to the UK regulatory regime and is therefore intended for consumers based in the UK.

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