This article was last updated on 1 October 2020.
Your home has value tied to it that you can turn into a source of retirement income. Equity release refers to the process of cashing in on that value in exchange for a lump sum. Your financial services register may provide more than one option for homeowners.
The money acquired after releasing the equity on a property value can be used for anything.
Before deciding what lump sum to offer you, lenders will look at various elements such as age, property value and the type of investment (primary residence or holiday home).
Before a property owner can approach a lender to release equity, it helps to know what to expect. A house equity release loan calculator is designed for this purpose, as it will give you a good idea of how much cash you could release from your home.
Equity release rates are coming down as interest rates in the UK start to fall. The table below sets out some of the best rates available.
Give us a call to see if there are better rates than this currently available, as they do change on a very regular basis.
|Equity Release Provider||Rate||Key Feature|
|Legal General||2.9%||Cashback & free valuation|
|Pure Retirement||2.99%||10%pa Partial Repayment Option|
|More 2 Life||3%||Downsizing Repayment Charge Exemption|
|Legal & General||3%||Cashback & free valuation|
|Aviva||3.4%||3-year No Early Repayment Charge|
If you have any questions or just need some advice you can call us on 0800 953 3792.
An equity release mortgage calculator is a tool that makes it easy to determine if a homeowner can afford to get a lifetime mortgage or home reversion plan. A majority of UK financial institutions provide calculators for members with equity release products. All respectable providers are also members of the equity release council. All the product providers are also authorised and regulated by the financial conduct authority.
The tool is designed for simple use, requiring you to submit some details to determine how much you could release, typically from a lifetime mortgage.
The application comes in handy when considering releasing part of the home equity but is not ready to involve any experts.
You get an estimate as to the capital you could release to guide your decisions.
Some tools are built specifically for home reversion schemes, while others are for lifetime mortgages. Note that the figure you get from any calculation is an estimate. Therefore, it may not be the exact amount that a bank arrives at.
You can learn more about how equity release cost and products work in this video.
When you use an equity release calculator, no personal details need to be inputted. However, this should not cause you an issue as just because you leave your details it does not always mean that you will be contacted. Therefore, there should be no problem with leaving your personal details.
Use the free releasing equity calculator below to see how much money you could receive.
If you have any questions or just need some advice you can call us on 0800 953 3792.
Just because the option for equity release is there, it doesn’t always mean that it’s right for you. Not all calculators require an email.
A number of individuals can end up in a worse monetary situation by choosing an unsuitable retirement product. Worse still, a property owner can leave the family paying for the accrued interest for years.
The question ‘how does equity release work’ is only part of the preparation. A property owner should know about his or her affordability. If you sell a portion of your property to take out a mortgage, can you afford the interests? An equity calculator allows you to answer this.
If it’s a lifetime mortgage, a lifetime mortgage calculator will tell you how much interest it will generate. Remember that interest rates vary with lenders and the creditworthiness of the borrower.
If it’s a home reversion plan, interest doesn’t apply.
For example, one lender may have a maximum lump sum of 60% of the property value for its lifetime mortgage. Another may insist that an applicant for home reversion be at least 65 years old.
By using different calculators, you can see what various lenders are willing to offer relative to your property value.
Here is a useful video about how an equity release scheme calculator works.
Other than figuring out how much money you could release, a calculator can help with the interest. Lifetime mortgages accrue interest over their lifespans.
Any borrower must know what this is before applying. Equity release scheme calculators that are designed for lifetime mortgages often have many factors which allow you to calculate the overall interest.
The debt after releasing equity can compound significantly. Learning how much interest to expect can help a property owner decide if the loan is a suitable option or if he or she should consider home reversion. Note that the interest rate will determine how much debt builds up.
Consequently, this debt will affect how much is left of your estate to bequeath.
Working out the equity release interest payments is simple. Almost all providers have fixed interest rates for these products. Therefore, you only have to know what applies for one month.
You can use a calculator to compare equity release interest rates from different lenders so that you can pick the most affordable one.
Almost every lender that offers a mortgage will have a free equity release calculator online. A big plus side to these tools is the cost savings when researching and comparing products. You can check how much provider A is willing to give for 40% of your house against provider B.
With an equity release calculator, this comparison doesn’t cost anything but a few minutes.
Part of your due diligence before applying for equity release is knowing if it’s suitable. A free calculator allows you to evaluate that without spending on an advisor. You can invest in an expert service after learning if an equity release scheme is a good solution.
A retirement mortgage is almost similar in structure to the conventional product.
You have to pay interest for the duration of the loan. It is why you must know how much this interest will be. A repayment calculator will help you work out the approximate interest.
Lenders attach fixed interest rates to lifetime mortgages. However, some institutions have variable interests. In such instances, providers have to adhere to an ‘interest cap’ to ensure that they don’t cost too much. Whichever the case, an equity release repayment calculator comes in handy.
When you know the repayment expected for a loan, it makes it easier to create an interest repayment plan. Sticking to a repayment schedule will make the loan less expensive and reduce the burden when it is due.
A provider can consider your monthly income to determine if you can make monthly interest rate payment.
Use our equity release interest rates calculator to see what the cost for you could be.
If a bank, credit union or building society offers equity release, a calculator will be available. If not, you can search the web site for equity release calculators from a registered office or use the one above.
Most applications will not ask for forms or other information except for the homes value and some basic personal details such as your name, property type and address line etc.. You can also find calculators by going through the equity release council. All mortgage providers are also authorised and regulated by the financial conduct authority (FCA).
When searching for an equity release calculator online, check that it is the proper one, and that it is authorised and regulated by the financial conduct authority. Remember that home reversion and lifetime mortgage products are two different products, so the calculations are different.
You want to be certain that the estimates you get are as accurate as possible to ensure you know how much you could borrow as a cash lump sum from any equity release plans you take out against the property value.
Online calculators are usually easy to use, but you can look at examples to understand the functionality. You can click on the calculator below to try one out.
Releasing equity from your property value is a practical solution long term for many people aged 55 and over. The retirement product allows a homeowner to take out tax-free cash, perhaps in the form of a lifetime mortgage, or sell part of their home. After an individual dies or moves into a care facility, the property can be sold to cover the interest.
Using equity release to pay for care costs makes it possible to retain a high quality of life. Equity release is, however, not suitable in all circumstances. A homeowner must be able to afford it and qualify. An equity release interest calculator can help to tell if the product is the right solution and find out home much tax-free cash you can receive from the equity release plan.
A no negative equity guarantee means that you will never owe more than the value of the home. This type of equity release will help borrowers get comfort in the event of the property prices falling below the amount they owed. In addition, for lifetime mortgages or other products to meet the Equity Release Council’s Product Standards, they are required to feature a “no negative equity guarantee”.
Equity release gives you the choice to release capital from the property of your home, to be used in retirement as a source of income. You could seek the experience of an expert to support you step by step and ensure that you meet the eligibility criteria required to release equity.
We work with with Key equity release for them to bring you their market leading equity release support. Through a free consultation they can help you decide what the best options could be for you.
If you would like some help, please leave your details below and someone will be in touch.
Or you can call Key directly on 0800 953 3792
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An equity release calculator will tell you how much money you could receive as a tax-free lump sum. The amount is usually dependant on your age and the value of your house.
Interest rates vary and can be anywhere between 3% and 7%. You can call us on 0800 953 3792 and get information on the latest deals, as they can change every day.
Yes, the money you receive is tax-free. However, if you are in receipt of means-tested benefits then these can be impacted. You can contact us on 0800 953 3792 and see if you would be impacted.
The money from equity release can be used for a variety of things. Typically it is used to pay for long term care, modify your home to help with later life living or even to treat yourself to a holiday of a lifetime and help your family financially.
The most popular type is called a lifetime mortgage. If you are over 65 then a home reversion plan might be a better option, Get in touch with us and we will be able to tell you what we think would be best for you.