This article provides an overview of the best equity release companies, highlighting the significance of equity release for homeowners over the age of 55.
It looks at the nuances of choosing the right equity release provider, the types of equity release available, and the factors to consider, such as fees, interest rates, and customer reviews.
The article will help you do the following:
Here are 7 key takeaways from this article:
If you decide that releasing equity is a good option for you, here’s a handy list of some of the leading equity release providers for loans. This is not an exhaustive list and is in no particular order.
We’ve only included those authorised and regulated by the Financial Conduct Authority and members of the Equity Release Council.
Please note that we do not advise on or endorse any particular product or provider listed here. This is an indicative list to give you an idea of the type of providers in the market. Please do your own research before deciding which one to choose.
Sunlife provides many financial, planning and insurance services to those over 50’s. As a trusted provider for those in the later stages of life, Sunlife provides a lot of information on their website about releasing equity and provides you with an advisor when you first contact them.
They also know the unique challenges of being at that age, so they provide more support than most.
This way, you can be safe knowing you’re making the right decision if you decide to release some of the equity in your home! Sunlife also has an equity release mortgage calculator.
Aviva is the largest insurance company in the UK and has existed for over 320 years, so they are a pretty well-established company in terms of finances, health, and insurance.
They are also What Mortgage award winners for the equity releasing loans. They only come in mortgages; their minimum loan must be £15,000, and you must be mortgage-free or have a small one on your property. The Financial Conduct Authority also regulates Aviva.
OneFamily is a cooperative company owned and run by its customers. As a result of this, their loans are highly adaptable and can offer fixed or variable rates on lifetime mortgages and home reversion.
When you contact them regarding your loan, they will offer free, impartial advice that compares their product against others in the marketplace, which will help you stay informed. It is worth noting that participating in one of their services brings other benefits by becoming a stakeholder in their business.
Pure Retirement calls themselves the “Experts in Equity Release”, placing themselves as specialists in the area. They make it their mission to not only provide great loans but also to give first-class customer service. They only offer a lifetime drawdown mortgage in one lump sum. The Financial Conduct Authority also regulates them.
LV= is best known for its car insurance but is an all-cover insurance, investments, and retirement services provider. They offer equity release for equity in your home with two distinct loans: a flexible payment loan and a lump sum variety.
The flexible loan allows you to borrow different amounts at different times (up to a pre-determined cap).
Legal & General are a very widely-known pensions and retirement company. They offer a few different types of equity release for you with their mortgages. You can choose to have a cash lump sum with no interest payments or pay the monthly interest as it accrues.
You also have the choice to draw a monthly income from your property with their income mortgage, and some types of loans have no early repayment charges (Though this is negotiated at the start of the loan).
Legal & General is a regulated company authorised by the Equity Release Council and the Financial Conduct Authority.
More2Life are another company that specialises in helping people release equity in their homes. They also offer choices for your equity release plan, including “enhanced” plans.
These plans consider your medical history, conditions and overall health, which can give you better terms, including better interest rates and higher amounts to borrow.
Just provide all kinds of retirement financial solutions and an equity release mortgage. Some of their loans have a fixed monthly interest, that is agreed upon at the loan’s start. Just also provide you with a home reversion service if that is what you feel is more appropriate to your current situation.
Sometimes, Just offers medical enhancements to your plan if you are ill.
Finally, Canada Life is a retirement, investment and protection company that has been in business in the UK for over 115 years.
They offer many different types of equity release scheme including – uniquely, a second home mortgage. They also offer a voluntary payment plan which also negates early repayment charges.
Responsible Equity Release is a company that operates in the UK.
Responsible Equity Release offers advice and guidance through their team of advisers, who help homeowners understand the implications of using equity release, including how it affects their estate and any inheritance they plan to leave behind. The company focuses on providing personalised solutions that meet the financial needs of their clients, ensuring that they make informed decisions.
Saga Equity Release is a service offered by Saga, a UK-based company that is well known for its focus on the needs of those aged 50 and above.
Saga provides a range of services, including insurance, holidays, and financial services, with equity release being a part of their financial offerings.
Through their equity release service, Saga offers products like a later life mortgage, which are designed to allow homeowners to borrow money against the value of their home. The loan plus compound interest is repaid when the home is eventually sold, typically when the borrower dies or moves into long term care.
Saga partners with reputable lenders in the equity release market to ensure their customers receive products that are safe and comply with the standards set by the Equity Release Council.
Regarding which banks do equity release, there are several to consider.
Various banks and financial institutions in the UK now offer equity release schemes.
Below are some of the banks that offer equity release products, along with a brief explanation of their services.
Barclays offers a range of lifetime mortgage products.
Lloyds Bank allows homeowners to release equity through a lifetime mortgage. This product is designed to help individuals access the wealth tied up in their homes, with the flexibility to make voluntary repayments or let the interest roll up.
Nationwide Building Society also offers a range of equity release products, including lifetime mortgages. Rothesay Life funds Nationwide’s equity release plan. Once your Nationwide plan is set up, Pure Retirement will look after you. Pure Retirement is seen as one of the biggest equity release lenders in the UK market.
A free equity release calculator allows you to enter basic information about your property, such as its market value and your age, to estimate the amount of cash you could potentially release via an equity release product.
The amount you can release depends on lender requirements, circumstances, and the equity release plan you select.
Try Age Partnership’s equity release calculator and estimate how much money you could release from your property.
If you take out a product from Age Partnership, we will receive a fee for introducing you to them. This helps support the site and for us to produce more content.
Understanding the financial implications is crucial before proceeding with an equity release plan.
Below, we have outlined the key financial factors you should consider.
Equity release plans, particularly lifetime mortgages, come with fixed or variable interest rates. The interest compounds over time, meaning the amount you owe can grow quickly. It’s important to consider the rate and its impact on the equity left in your home.
Setting up an equity release plan involves various fees, including:
Charged by your financial adviser for providing equity release advice.
Charged by the provider for setting up the plan.
For assessing your property’s value.
For the legal work involved in arranging the equity release.
Some providers might offer plans with no arrangement fees or provide contributions towards legal fees.
Using equity release reduces the value of your estate, affecting the amount of inheritance you can leave to your heirs. It’s essential to consider this impact and discuss it with your family.
Releasing equity from your home may affect your entitlement to means-tested benefits, such as Pension Credit and Council Tax Support. You should assess how equity release could affect your eligibility for these benefits.
You may face significant early repayment charges if you decide to repay your equity release plan early. These charges can vary widely between providers and plans, so understanding the potential costs is crucial.
Most equity release plans come with a no negative equity guarantee, ensuring you or your estate will not owe more than the value of your home when it is sold.
This guarantee is a crucial protection. However, it does not remove the financial implications of the amount of interest accruing over time.
Considering these financial implications is vital in making an informed decision about equity release.
Discussing these aspects with a qualified equity release adviser who can provide personalised advice based on your financial situation and objectives is recommended.
Interest rates and accrued interest substantially, over time, impact the total cost of an equity release mortgage.
Over time, the interest accrues, increasing the amount you owe, ultimately reducing the remaining equity in your property and impacting the inheritance you can leave to your beneficiaries.
To control these expenses, you can:
Some of the Best Equity Release Interest Rates as of 18 April 2024
The table below shows you some of the best equity release rates for lifetime mortgages from some of the leading equity release providers in the UK.
| Provider Name | Product Name | Interest Rate | Type of product | Offers | ||
|---|---|---|---|---|---|---|
 | Just | Just For You – J1 Green | 5.35% | Fixed | Free Valuation No application fee | |
| Just | Just For You – J2 Green | 5.40% | Fixed | Free Valuation No application fee | |
 | Scottish Widows | FR1 | 5.50% | Fixed | Cashback Free Valuation No application fee | |
| Just | Just For You – J2 | 5.50% | Fixed | Free Valuation No application fee | |
 | Standard Life | Horizon 200 Drawdown | 5.50% | Fixed | Free Valuation | |
| Standard Life | Horizon 200 Drawdown Fee Free | 5.55% | Fixed | Free Valuation No application fee | |
| Scottish Widows | FR2 | 5.57% | Fixed | Cashback Free Valuation No application fee | |
| Standard Life | Horizon 220 Drawdown Fee Free | 5.59% | Fixed | Free Valuation No application fee | |
| Standard Life | Horizon 240 Drawdown | 5.59% | Fixed | Free Valuation | |
 | More 2 Life | Capital Choice Ultra Lite Drawdown 1 | 5.60% | Fixed | Free Valuation No application fee |
The equity release rates have been sourced by UK Care Guide from the Equity Release Supermarket website. These rates may have changed since this table was created and should be taken as indicative only. There may be other providers not listed on this table that could offer better deals. In addition, the providers and products noted may not be right for your particular circumstances. Therefore, they should only be taken as a guide, and we cannot guarantee their current accuracy. Please also note that we do not provide advice on or endorse any particular product listed here. The rate you are offered will depend on your individual circumstances and subject to lender approval. Therefore, we strongly recommend that you speak to an equity release adviser, who will be able to provide you with information on the latest rates that apply to you.
Speak To An Equity Release Specialist Today
Call Boon Brokers on 0333 567 1607 to discuss your equity release requirements and see what deals are available to you.
Understanding the eligibility criteria for equity release is crucial before deciding what to do. We have set out below some of the key issues that you will need to consider.
The minimum age requirement for equity release is typically 55 years for lifetime mortgages and 65 years for home reversion plans.
Some providers may have higher age minimums. Therefore, it’s important to check with individual equity release providers.
Your property must meet a minimum value threshold, usually around £70,000 or higher. However, this can change between providers. The property’s value will also influence the equity amount that you can release.
The property must be located in the UK.
Some providers may have restrictions on properties in Northern Ireland, the Channel Islands, or the Isle of Man. Therefore, confirming with the equity release provider is advisable if your property’s location is eligible.
Eligible properties typically include freehold houses and bungalows.
Leasehold properties may be eligible. However, the lease must meet the provider’s minimum remaining term, which is often around 75-90 years, at the time of the application.
Flats and maisonettes may also be eligible, though certain restrictions may apply, especially if the house is an ex-local authority property.
If you have an outstanding mortgage or loans secured against your home, you must pay these off when taking out the equity release plan. This can be done with the funds released, but it will reduce the net amount that is available to you.
The property must be in a good state of repair.
Providers may require a survey to assess the property’s condition. Any significant repair work needed may have to be completed before the equity release can proceed.
Meeting these criteria does not guarantee acceptance for an equity release plan, as providers will also consider other factors, such as your health and lifestyle, when determining the amount of equity you can release.
It’s important to discuss your circumstances with a qualified equity release adviser who can guide you through the eligibility assessment process and help you understand your options.
Below, we have set out details of the main types of plans that you can access in the UK.
A Lifetime Mortgage is the most popular form of equity release.
This type of plan allows you to take out a loan secured against your home while allowing yout to retain ownership of your property.
You do not have to make regular repayments as the loan, along with the accrued interest, is repaid from the sale of your home when you pass away or move into long-term care. The amount you can borrow typically depends on your age and the value of your property. There are several types of lifetime mortgages available, including:
This option allows you to release equity as and when you need it, which can help reduce the amount of interest accumulating over time.
With this type, you can pay off the interest each month, which helps maintain the equity you have in your home.
If you have certain health conditions or lifestyle factors, you may be able to release more equity through an enhanced plan.
Here is a short video explaining what a Lifetime mortgage is.
The article from the FT, published on 28th February 2024, discusses a recent survey from Canada Life, revealing that the primary motivation for homeowners considering equity release is to clear their mortgage.
It highlights a shift in the financial strategies of older homeowners in the UK, who are increasingly considering equity release as a viable option for managing their mortgage debts into retirement.
The survey indicates that many individuals are motivated to help deal with financial pressures and secure a more comfortable financial situation as they age.
The research further explores the implications of this trend, suggesting that while equity release offers immediate financial relief by clearing existing mortgage debts, it also raises questions about long-term financial planning and the inheritance prospects for the next generation.
Saq Hussain, Finance Editor at the UK Care Guide, commented on the findings, stating, “The shift towards using equity release to clear mortgage debts reflects broader economic challenges and changing attitudes towards retirement planning.”
As we move through 2024, it’s essential to understand the implications of such financial decisions, not just for the individuals directly involved but also for the wider economy and the future financial health of families.
A 2024 equity release study by the UK Care Guide has illuminated a trend where many retirees are looking towards equity release to support their financial needs during retirement.
Specifically, the survey involving 1,803 participants aged 55 and above found that 40% consider equity release as an additional source to their pension, signalling a significant interest in leveraging home equity to secure a more comfortable retirement.
However, the enthusiasm for equity release is tempered by concerns over the associated costs, with interest rates being a particular area of worry for 42% of the surveyed individuals. This apprehension highlights the critical need for clear, comprehensive information regarding the financial commitments involved in equity release plans.
The findings underscore the value of expert financial advice in navigating the retirement planning landscape.
39% of respondents preferred to consult with independent financial advisors, emphasising the importance of professional guidance in making informed decisions about utilising equity release as a retirement funding strategy.
While a lifetime mortgage allows you to retain ownership of the property, a reversion sells your property to a provider allowing you to live in the property rent-free until you pass on.
You can get this money back either as one lump sum, or monthly instalment payments.
It is worth noting that with this option, you will normally have a guarantee on having no negative equity.
This means that once your house is sold after you’ve passed, even if the value of the sale doesn’t add up to the original value of the loan plus agents’ and solicitors’ fees etc., you will not have to pay anything to your provider.
Here is a video that explains the advantages and disadvantages of Home Reversion plans.
Below we have set out the process involved if you do decide to take out an equity release product.
The first step in the equity release process is to consult with a qualified adviser. This meeting is crucial for discussing your financial needs, circumstances, and the potential impact of equity release on your estate and entitlement to means-tested benefits. Advisers will also cover the different types of equity release schemes available and help you decide whether equity release is right for you.
Once you decide to proceed with equity release, your chosen provider will arrange for a professional valuation. This valuation will determine how much money you can release from your home, based on its market value and any outstanding mortgage or loans secured against it.
You will need to appoint a solicitor specialising in equity release to handle the legal aspects of the process. Your solicitor will ensure that you understand the terms and conditions of the equity release plan and will work with the provider’s solicitor to complete the necessary legal paperwork.
After the valuation and legal work, the equity release provider will make you an offer. If you decide to accept this offer, your solicitor will help you complete the acceptance process.
If you’ve chosen a drawdown plan, the equity release funds will then be released to you, either as a lump sum or in smaller amounts.
For lifetime mortgages, the loan and any interest accrued are typically repaid from the sale of your home when you pass away or move into long-term care. For home reversion plans, the provider owns the part of your home you’ve sold, and there’s no loan to repay.
Each step in the equity release process is designed to ensure that you are making a well-informed decision. It’s important to take your time, ask questions, and consider all your options carefully.
Before releasing equity from your home, it is important to consider factors such as your current financial situation, future needs, and existing mortgage.
Tips for safely and effectively releasing equity include:
This case study aims to show how you might approach this issue practically, providing insights that could benefit you if you consider equity release, as a financial option.
The journey begins with John, a 65-year-old retiree, looking to supplement his pension by releasing some of the equity tied up in his home.
Aware of the long-term impact interest rates can have on the amount borrowed and owed over time, John starts by researching various equity release schemes available in the UK market. He focuses on comparing the interest rates, the fees, and the flexibility offered by the different lenders.
John then consults with a financial adviser specialising in equity release.
This person helps him understand the nuances of lifetime mortgages and home reversion plans, including choosing a plan with a competitive interest rate.
The adviser also explains how interest compounds over the years and the potential impact on John’s estate and any inheritance he wishes to leave.
Finally, John attends a seminar hosted by a reputable equity release provider, where he gains further insights into current market trends and interest rate forecasts. Armed with comprehensive information and professional advice, he feels confident in selecting an equity release scheme that offers a favourable interest rate, ensuring financial stability and peace of mind during his retirement years.
This case study helps to show the importance of doing thorough research and taking professional advice when making decisions about equity release.
It is difficult to say which equity release company you should avoid, as it often depends on your individual circumstances. However, an equity release advisor should be able to help you pick a suitable provider. They will undertake ‘due diligence’ on your behalf.
This article is a comprehensive guide to understanding and selecting the best equity release companies in the UK.
It emphasises the importance of equity release as a financial strategy for homeowners who are over 55. It also provides them with the means to access the equity that is built up in their homes.
The key pieces of information presented include:
The UK Care Guide works in partnership with Boon Brokers, one of the UKs leading equity release specialists.
You can contact them on 0333 567 1607 , or use the equity release calculator to estimate how much you can borrow.
Call Boon Brokers on 0333 567 1607 to discuss your equity release requirements.
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All equity release and mortgage advice is provided by Boon Brokers Limited, which is authorised and regulated by the Financial Conduct Authority (FCA). The Financial Services Register number is 973757.
If you take out a product with Boon Brokers, we will receive a fee for introducing you to them. Boon Brokers provides advice for free and without obligation. By contacting Boon Brokers through us, the cost of any equity release product would be the same as if you had contacted them directly.
The fee we receive is used to help keep this site operational and to produce new content.
Think carefully before securing other debts against your home. Your home or property may be repossessed if you do not keep up repayments on your mortgage.
Saq is a financial expert and is responsible for the day-to-day running of the UK Care Guide website. Before taking on the operation of this site, Saq was a Director and the UK Head of DC Pensions, Benefits and Wellbeing at PwC. Saq is also a part of the steering group at the Living Wage Foundation, which has developed the UK’s National Living Pension standard.
Saq has regularly featured in the press, with examples including:
Where applicable, the adverts for Boon Brokers on this page have been signed off as a Financial Promotion by Boon Brokers Limited, to ensure that they are in compliance with Section 21 of FSMA. Boon Brokers Limited is authorised and regulated by the Financial Conduct Authority (FCA). The Financial Services Register number is 973757.
The Age Partnership equity release calculator has been approved and provided by Age Partnership. Age Partnership is a trading name of Age Partnership Limited, which is authorised and regulated by the Financial Conduct Authority. FCA registered number 425432.
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All equity release advice is provided by Boon Brokers Limited, which is authorised and regulated by the Financial Conduct Authority (FCA). The Financial Services Register number is 973757.
If you take out a product with Boon Brokers, we will receive a fee for introducing you to them. Boon Brokers provides advice for free and without obligation. By contacting Boon Brokers through us, the cost of any equity release product would be the same as if you had contacted them directly.
The fee we receive is used to help keep this site operational and to produce new content.
Think carefully before securing other debts against your home. Your home or property may be repossessed if you do not keep up repayments on your mortgage.
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