Can I Sell My House If I Have a Lifetime Mortgage?

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By Clare Townhill • Updated 4 December 2025
Disclaimer: Prices and ratings correct at time of writing.

Having an equity release plan on your home doesn't mean you are locked in forever. You remain the legal owner, and, yes, you can sell your property if you decide to move. The key difference is that because a lifetime mortgage is secured against your home, the loan (plus any interest that has built up) must usually be repaid when you sell, unless you transfer the plan to a new property that your lender approves.

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    How Selling Works With Equity Release

    When you sell a property that has an equity release plan in place, here's what typically happens:

    • Settlement figure - your lender gives you a statement showing exactly how much you owe, including any rolled-up interest.
    • Sale proceeds - when the property is sold, the loan is repaid first. The money left over is yours.
    • Your options - you can either:
      • Repay in full - clear the balance (and any charges) and move on mortgage-free.
      • Port the plan - transfer your lifetime mortgage to your new home, if the property meets your lender's rules.

    Early Repayment Charges (ERCs) Explained

    An Early Repayment Charge (ERC) is a fee you may have to pay if you repay your equity release plan earlier than expected. These charges vary by provider, but they can be significant — sometimes a fixed percentage of the loan, or linked to government bond yields.

    💡 Example:
    Sarah released £50,000 through equity release ten years ago. By the time she sells, the balance (loan + interest) has grown to £82,000. She also faces an ERC of 10% — an extra £8,200 — because she is repaying early. After her house sells for £250,000, the lender takes £90,200, leaving Sarah the rest to use for her next move.
    💡 What is Rolled-Up Interest?
    With most equity release plans, you don't make monthly repayments. Instead, the interest is 'rolled up' — added to your loan balance each year. This means you pay interest on both the original loan and the interest already added, a process called compound interest.

    Example:
    After 1 year, your balance is £53,000 (from £50,000 at 6%).
    After 5 years, it grows to about £67,000.
    After 15 years, it could be over £120,000.

    This is why equity release reduces the inheritance you leave behind unless you make voluntary repayments to keep the balance and interest under control.

    Porting Your Equity Release Plan

    Instead of paying off your plan, you may be able to port it — which means transferring your lifetime mortgage to your new home. This is often allowed if the new property meets the lender's criteria (for example, they may reject retirement flats, thatched cottages, or homes of non-standard construction).

    💡 Example:
    David and Anne have an equity release plan on their £300,000 family home. When they downsize to a £220,000 bungalow, they are able to port their lifetime mortgage because the new property fits their lender's requirements. Their balance transfers across, avoiding any ERC. The remaining equity from the sale helps top up their retirement savings.

    Your Options When Selling a Home With Equity Release

    Option What Happens Example (Illustrative Only) Pros Cons
    Repay in full You sell your home and use part of the proceeds to repay the lifetime mortgage balance plus any Early Repayment Charges (ERCs). Sarah borrowed £50,000. After 10 years, the interest grew the balance to £82,000. She also faced a 10% ERC (£8,200). After selling her home for £250,000, £90,200 went to the lender, leaving her with £159,800.
    • You are free of the plan.
    • Maximum flexibility for the next move.
    • ERCs can be costly.
    • Less equity left to use or pass on.
    Port the plan You transfer ("port") your equity release to a new property that meets the lender's rules. David and Anne had an equity release plan on their £300,000 home. When they downsized to a £220,000 bungalow, their balance was transferred without ERC because the property met lender criteria. They used the remaining equity to boost retirement savings.
    • Avoids Early Repayment Charges.
    • Keep your existing plan terms.
    • New property must meet strict criteria.
    • Limits the choice of future homes.
    ⚠️ Note: ERCs (Early Repayment Charges) vary significantly by provider and plan. The 10% figure here is illustrative only. Always request a settlement statement from your lender before deciding whether to sell your home. If you think that you may need to sell your house in the future, and you do not yet have a lifetime mortgage, it may be worth considering whether equity release is right for you.

    Things to Check Before You Sell

    • Early Repayment Charges (ERCs) ask your lender to confirm whether charges apply and how much.
    • Porting criteria - not every property will be eligible, so check before you commit.
    • Advice - speak to a regulated financial adviser before making a decision.
    • Family discussions - talk openly with loved ones, as selling with equity release affects the inheritance they may receive.

    Conclusion

    You can sell your house even if you have equity release, but the details matter. In most cases, the loan plus interest will need to be repaid from the sale proceeds, and there may be Early Repayment Charges if you repay in full. Porting can be a useful alternative if you want to move without closing your plan, though your new property must meet your lender's rules.

    Because terms vary widely, always check your plan's conditions, get a settlement figure from your provider, and take advice from a regulated equity release adviser or broker before making any big decisions.

    Did you find this information helpful?

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