Why use this equity release calculator?
- It's free to use and there is no obligation to go any further
- It takes seconds to find out how much money you could release
- There are no credit checks and your credit score will not be affected
- Information is provided by award-winning specialist Age Partnership
- If you decide to find out more, your initial consultation is free
How can our calculator get you a better equity release deal?
While most equity release calculators work in a similar way, not all give you access to independent advice and exclusive equity release deals.
Our carefully chosen partner Age Partnership compares leading UK equity release providers to find you the best deal and the right plan for your unique circumstances.
This lifetime mortgage calculator is intended to give you a sense of how much money you could unlock from your home. When you’re ready, specialist advisers will be on hand to give you a more accurate and personal illustration.
What is equity release?
Equity release enables you to access the cash tied up in the value of your home (the equity) tax-free, while continuing to live in it until you die or move permanently into long term care.
- Lifetime mortgage – a loan secured on your home that doesn’t have to be repaid until you die or move into care. The loan is usually repaid from the sale proceeds of your home.
- Home reversion plan – you sell all or part of your home to the equity release lender at below market value in exchange for a cash sum. You continue to live in your home as a tenant, rent-free.
Different repayment options for equity release
With a lifetime mortgage, you don't have to repay anything back until you die or move into long term care.
At this point, the value of the loan plus the interest accrued will need to be repaid, typically from the proceeds of the sale of your home, although it doesn't have to be.
Most lifetime mortgages also give you the option to make voluntary regular or occasional repayments during the life of the mortgage without charge, to help reduce the amount of compound interest rolling up.
You're also entitled to make partial repayments or pay off your lifetime mortgage sooner if you wish, however, you could incur an Early Repayment Charge (ERC). This charge varies by lender but could be significant, so check the terms and conditions carefully.
Are you eligible for equity release?
To be eligible for equity release you will need to;
- Be at least 55 years old if you are looking for lifetime mortgage
- Be at least 65 years old for a home reversion plan
- Be a UK homeowner with a property worth £70,000 or more
Other factors that may affect whether you are eligible for equity release include:
- The amount of your outstanding mortgage (if any)
- Where in the UK the property is located and whether it is near a building or plant that could affect its value
- The condition of the property
- The construction of the property
For further details of whether you might be eligible for equity release see our equity release criteria page.
5 popular queries about equity release
Here’s a selection of five popular queries chosen from our most frequently asked questions page:
1) Will I pay tax on the money I release?
No, you won’t. The cash you release is tax free and all yours to use as you wish.
What you decide to do with the money might have tax implications though. For instance, if you invested the money until you needed it, rather than spending it, you might be liable for tax on the amount you put aside. For this reason, equity release is best regarded as a source of income or funding for particular purposes, rather than for saving.
2) Do I have to take all the money at once?
With any equity release lifetime mortgage, you will receive a lump sum at the start of your plan. However, if you choose a drawdown lifetime mortgage you can choose to hold a proportion of the loan in reserve, to draw on as and when you like. In fact, these plans can often work out to be more cost-effective because, as you only pay interest on the cash you have withdrawn, the interest grows at a slower pace.
3) What happens to equity release when I die or go into care?
If you've taken out a joint equity release plan with your spouse or partner, the agreement will give each of you the right to continue living in your home until the second person dies or goes into care.
If the surviving partner wants to downsize, some lifetime mortgage lenders will allow them to pay off the loan without penalty, provided they do so with an agreed time period, which is usually three years.
4) Can I ringfence some equity to leave as an inheritance?
Any lifetime mortgage provided by an Equity Release Council member includes an Inheritance Protection Guarantee, which allows you to protect a percentage of the final sale value of your property to leave to loved ones as an inheritance.
5) Can I get equity release on my second home?
The answer is possibly. Some equity release providers will consider different property types such as a second home, as long as it is of standard construction and on the UK mainland. However, they will also want to know whether you let the property and, if so, for how many weeks per year.
The amount you can release from a second property is likely to be less than the amount you could release from your main home.
See more FAQs about equity release.