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Equity release calculator

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Why choose us?

  • We're part of Key Group, the UK's largest provider of equity release services

  • Our equity release calculator is free and easy to use

  • We recommend plans which meet the Equity Release Council standards and compare plans from the whole market, including:

ⓘ Check the benefits and drawbacks before you go ahead

Benefits and drawbacks of equity release

Equity release is a way to access some of the tax-free funds locked in your property. It is available to UK homeowners aged 55 or over and with a property worth at least £70,000.

There are two types of equity release; lifetime mortgages or home reversions. Find out more about the benefits and drawbacks of both types of equity release below:

Lifetime mortgage benefits

Your specialist equity release adviser will explain:

  • Tax-free cash: You can unlock cash from your home, tax-free, to help meet your needs in later life
  • Stay in your home: With a lifetime mortgage and payment-term lifetime mortgage you'll always own your own home and have the right to stay in your property for as long as you wish, however, with a payment-term lifetime mortgage you must ensure all mandatory payments are met
  • Reduced or no monthly repayments: You can make reduced or no monthly repayments with a lifetime mortgage. This is the same with a payment-term lifetime mortgage after its mandatory payment period ends, overpayments can be made, subject to lender's criteria
  • No negative equity guarantee: You’ll never owe more than your home's worth or pass on any equity release debt to your family, providing you keep to the terms of your plan
  • You can still move house: You have the right to move home in the future, subject to criteria

Lifetime mortgage drawbacks

Your equity release adviser will also outline the following important things to think about:

  • The interest can build up quickly: Lifetime mortgages and payment-term lifetime mortgages are loans secured against your home and are subject to compound interest, meaning the amount you owe can grow quickly
  • Mandatory payments: There’s a period of mandatory payments with a payment-term lifetime mortgage, and your home may be repossessed if you don't keep up with these payments
  • Reduced or no property equity: Equity release may leave you with limited or no property equity remaining and will reduce your financial options in the future
  • Effect on estate & means-tested benefits: Equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits
  • Long-term financial product: These are long-term financial products and are not designed to be repaid early. If you do, early repayment charges may apply

Home reversion benefits

Your specialist equity release adviser will explain:

  • Releasing equity from your home is tax-free
  • You can live in your home until you pass away or move into permanent care
  • There’s no interest to pay (this isn't a loan)
  • You’ll benefit from property value increases on your unsold percentage
  • You can protect a portion of your property for inheritance, as long as you don't sell 100% of your home

Home reversion drawbacks

Your equity release adviser will also outline the following important things to think about:

  • You'll receive less than the market value when selling your property to the home reversion provider
  • It's expensive to cancel the plan early as you'd buy your property back at the full market value
  • You won't be the legal owner of the property
  • It'll reduce your financial options in the future
  • You may be left with limited or no property equity remaining, depending on the % sold

How to calculate the amount of equity in your home

Simply put, the equity you have in your home is the difference between the current market value of your property and the total sum of debts secured against it. The debts are typically any existing mortgage or secured loans.

There are a number of factors that dictate how much you may be able to release, such as the value of your property, your age and your health & lifestyle choices. By using our free equity release calculator, we’ll be able to give you a guide to the funds you may be able to release.
 

How do I release some of the equity from my home?

Our calculator uses two main factors to determine how much could be available to you:

  1. Your property value: The higher the value, the higher the calculation could potentially be. The minimum property value to be eligible for equity release is £70,000.

  2. The age of the youngest applicant: If you’re applying as a couple, the amount of equity you can release will be calculated on the youngest applicant. To qualify, both of you must be aged 55 or over.

Once you’ve calculated how much you may be able to release, our expert advisers will be able to discuss your options with you.

If you want to know more about the eligibility criteria, our team of experts are always on hand. Should you wish to book an appointment, they’ll be able to arrange a time for you to speak to an equity release adviser who will chat you through the options that are available and also discuss the other later life lending options that are available. 
 

Talk to the equity release specialists

We specialise in offering reliable, honest equity release advice and we compare plans from across the market. If you want to find out whether it could be the right choice for you, get in touch today for a free, no-obligation consultation. 

We'll always tell you if equity release isn't right for you, and we offer a full range of later life options, so we can see if there is another product more suitable for your needs. Phone The Equity Release Experts on 0800 188 4812 or ask us to call you back. 

Unless you decide to go ahead, our service is completely free of charge as our fixed advice fee of £1,799 is only payable on completion of a plan.

 

Your other options

It's important you're aware of some of your other later life finance options, which may include:

Retirement interest-only mortgage
Retirement repayment mortgage

Equity release costs

Knowing the costs associated with equity release and how to help manage them is important.

Compound interest explained
Lump sum vs drawdown lifetime mortgage
What does equity release cost?

Other options we don't offer

  • Downsizing
  • Unsecured lending
  • Using existing assets
  • Support from friends or family

Guide

Your free equity release guide gives you all the facts you need to make the decision that’s right for you
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Equity release FAQs

How does compound interest work?

Unless you choose to do so, there are no repayments to make on a lifetime mortgage until the plan comes to an end. As a result, you pay interest not only on the loan itself, but also on the interest already added to the loan - this is known as compound interest.

With a lifetime mortgage the loan, plus compound interest, is typically repaid through the sale of the property when the last remaining applicant passes away or moves into long-term care. (Not applicable for home reversion plans).

More on compound interest
 

How could a drawdown lifetime mortgage reduce my cost of borrowing?

You could potentially save thousands over the course of your plan with a drawdown lifetime mortgage. This is because you only pay interest on the funds you release.

With a drawdown lifetime mortgage, you only take out the money when you need it. This can help reduce your total cost of borrowing, as interest is only charged on the money you release, rather than the full amount available. You could also reduce the cost of borrowing on a lifetime mortgage by:

  • Making repayments: You have the option to make ad-hoc or regular repayments, subject to criteria, to help reduce your total cost of borrowing. Even if you can only make small repayments, it will help reduce the amount of interest you pay over the lifetime of your loan.

  • Remortgage to another equity release plan in the future: If interest rates reduce in the future, you may have the option to remortgage your current plan to secure a lower rate. Getting a lower rate isn't guaranteed and you may need to consider early repayment charges if you choose to remortgage. 

Future drawdowns are subject to the prevailing interest rate at the time and are not guaranteed.

More on lump sum vs drawdown lifetime mortgage
 

Can you pay off equity release early?

If you’re wondering “can you pay off equity release early?”, you can, however, with a lifetime mortgage, you’ll need to be mindful of early repayment charges. Your adviser will make you aware of any early repayment charges included in your plan.

To repay a home reversion you need to buy back the percentage of the property you originally sold to the provider, however, this will be at the full market price.

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