Equity release advice

You can seek financial advice from one of our independent equity release advisors if you’re considering taking out an equity release product. All advisors who advise equity release plans must be qualified in their field.

The Regulation of equity release schemes

Firms advising on or selling equity release must be:

  • The agent of a regulated firm, or
  • Regulated by the Financial Conduct Authority (FCA).

And they need to have a relevant equity release qualification to give advice.

  • Regulated firms and their agents are placed on the FCA Register and have to meet certain standards.
  • Find an adviser with an equity release qualification
  • the Equity Release Council member directory – the Equity Release sector’s trade body Equity Release sector’s trade body. All equity Release adviser in Mortgage Saving Experts are members of the Equity Release Council

Things to Remember:

All companies that sell equity release products are required by law to provide you with advice.

This entails determining if equity release is appropriate for you and, if so, only recommending a product that meets your needs and circumstances.

If the advice you were given turns out to be unsuitable for you, you can file a complaint with the Financial Ombudsman Service. Often double-check that the company you’re working with is on the FCA Register.

If they aren’t, you won’t be able to have any protection from the Financial Ombudsman Service or the Financial Conduct Authority if anything goes wrong.

Some lifetime mortgages require you to pay the loan’s interest and/or a portion of the principal each month.

Since this is such a complicated area, it is now required that homeowners obtain independent legal advice, which must be obtained in person.

Want to know more?

For more details, call our Mortgage Saving Experts today.

Information you should receive

Step 1

When you contact a service provider or adviser, they must provide you with details about the services they provide.

This may be done orally or in a written form during the initial conversation.

In either case, they must confirm that they are giving you advice and state if they will:

  • charge you a fee.
  • Offer lifetime mortgages, home reversion plans, or both.
  • Offer equity release schemes from the whole market or a limited range of providers.

Use this knowledge to shop around for the service you want at a price you are comfortable with.

Step 2

The lender or advisor will send you a mortgage example document after they have made a decision.

This paper can be referred to as the Key Facts Illustration by them (KFI).

When recommending a mortgage, some mortgage advisers and lenders can send you this information.

These documents will provide you with a personalised illustration that will include information such as:

  • Any additional features.
  • The service you’re getting.
  • What happens if you don’t want the mortgage or plan any more.
  • The overall cost of the scheme, as well as any fees you’ll have to pay.
  • A description of the scheme, which the provider is and, for a lifetime mortgage, the interest rate deal.
  • What you’ve told them about how much you want to release and the type of scheme you’re interested in.
  • Where a lifetime mortgage requires regular payments, how much they would be if interest rates went up – so you can see whether you think you could cope with the increase.

Make sure you read and understand this document, and if anything is ambiguous, ask the provider or advisor to clarify it to you. It should outline the terms of the scheme that has been recommended, as well as any means-tested benefits that you might be eligible for.

This document can be used to shop around and compare similar plans from different providers.

Step 3

Once your application has been approved, you or your adviser will receive an offer document.

It will include details such as:

  • The fees
  • Your name and address
  • The amount you will receive, or
  • Any special conditions such as clearing any outstanding mortgages.

Be sure to read it carefully.

Helpful Tips about Equity Release

We’ve compiled a list of tips to help you get the most out of your equity release quest. These hints illustrate some of the considerations you’ll need to make when considering this path.

1. Avoid paying for advice

The majority of equity release companies charge between £500 and £2,000 for making their recommendation. Our initial consultation is free, and we do try not to charge a fee. We are happy to chat with you free of charge to see what your options are. Our service was created to provide you with professional advice from trained advisors.

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2. Consider all the alternative solutions available

The decision to take equity out of your home should not be taken lightly. You may be able to remove the need for borrowing or reduce the amount you need to borrow by considering your options.

Any reduction in the sum you release could result in a major reduction in the plan’s long-term cost and give you access to better offers with more flexibility.

The most common alternatives considered are:

  • Downsizing – selling and moving to a cheaper property.
  • Borrowing from family or friends
  • Using existing savings/investments
  • Claiming all available welfare benefits, such as pension credit
  • Home improvement grants

3. Only borrow what you need

Make a full list of your upcoming expenses. You do not want to pay interest on money that you do not require.

If you think you’ll need more money in the future, ‘flexible drawdown’ plans will help you get more money when you need it. This means you’ll only be charged interest on the money you’ve borrowed. Borrowing money in instalments rather than in one lump sum will save you a lot of money.

4. Think about paying the associated interest charges

If you can afford it, paying the interest on a monthly or annual basis is the most efficient way to manage any release expense. Many plans allow you to control your interest by making monthly payments or making overpayments.

Even if the full interest rate is unaffordable, partial repayments or overpayments will greatly reduce the expense.

5. Don’t judge a plan on interest rate alone

Although a low-interest rate is significant, you should also think about how your strategy will achieve your long-term goals.

Some of the questions to ask when choosing a plan include:

  • Can the plan be repaid early, and are there any early repayment charges?
  • Can you borrow additional funds in the future, and what costs would be involved?
  • Can the plan be moved to another property?
  • Who will own the property?
  • Is the plan regulated by the Financial Conduct Authority?
  • Does the plan meet the standards set by the Equity Release Council?

Any plan you choose must satisfy your immediate needs while still being adaptable to accommodate potential life changes.

6. Involve family members or a trusted friend

You are not required to do so, but we strongly advise that you discuss your plans with your family. If you choose not to include them, you can inform them that any potential inheritance will be diminished or eliminated.

If you don’t want to include family members, talk to a trusted friend about your plans.

Considering releasing equity?

Get expert free and impartial equity release advice on 01273 738 072 or arrange a call back at a convenient time.

7. Don’t proceed without impartial financial advice

Seek advice from our knowledgeable and professional advisors who can access all of the available plans and providers. This ensures that all choices are taken into account.

8. Choose an experienced solicitor

You must obtain impartial legal advice from any Equity Release solicitor. Ensure your preferred solicitor has experience with equity release and, preferably, settle on a fixed legal fee. Your solicitor would gladly refer you to a specialist solicitor.

9. Think carefully before borrowing money to invest

We will advise caution when releasing equity to make investments. Always seek professional advice, and keep in mind that your investments’ value will go up as well as down.

10. Consider the impact any borrowing may have on your entitlement to means-tested benefits

Having money in the bank that you don’t need could jeopardise your ability to receive benefits in the future. Our advisors will conduct full benefits review to ensure you’re receiving the maximum amount of benefits available and to determine the effect of any borrowing on your current and potential entitlement.

An interest-only lifetime mortgage, a lifetime mortgage, or a home reversion plan can be included in this scheme.

Want to know more?

Get in touch with of our mortgage saving experts today.

Equity release calculator

Our simple to use equity release calculator gives you an instant idea of how much equity you could release based on your age, property value and outstanding mortgage.

Mortgage Saving Experts is authorised and regulated by the Financial Conduct Authority.

Why choose us for equity release?

  • Free: We don’t charge you for our consultations. There aren’t any hidden fees
  • Unbiased: Our advisors don’t work to sales targets or bonuses
  • Specialist: We offer advice to all, from managing debts to those looking to retire
  • Trustworthy: In 2019, 98% of our clients said they would recommend us to family or friends*

Other organisations that can help

If you’re struggling to make ends meet and are looking for financial help, some several agencies and charities provide free information and advice.

Check your entitlement to benefits:


What are the alternatives to equity release?

You might
  • Downsize by moving into a less expensive home
  • Get a loan from your bank
  • Check you are entitled to any benefits such as grants etc.
  • Borrow from a family member
  • A retirement Interest Only Mortgage
  • A standard mortgage
Important considerations Before releasing equity from your home, it's important to consider that:
  • Releasing equity might affect your tax position and entitlement to means-tested benefits.
  • There may be more suitable alternatives, such as downsizing to a smaller property or Remortgaging.
  • Future property prices might be higher or lower than they are today.
  • Releasing equity from your home will reduce the value of your estate, affecting the amount of inheritance you might leave.
  • There are implications to securing other debts against your home.
  • Consolidating debts over a longer period may mean you pay more overall.
  • If you're planning home improvements, a government grant may be a better option for you.

Can you lose your house with an equity release?

No. If you agree to make repayments at the beginning of the mortgage and something happens where you are no longer able to afford those repayments then you just contact the lender directly and tell them you cannot afford the payments any longer and the interest will roll up but you will not lose your home. You should also be aware that:
  • If house prices fall, you may owe a larger percentage of your property’s value (unless you have a lifetime mortgage which is backed by the Equity release Council then this will not happen)
  • And if you sell your home a short time after taking out the equity release, you could lose some money overall because your Early repayment Charges could be extremely high. Call the mortgage lender first before you sell to see what the early Repayment Charges may be at that time to give you an idea.

Can you pay back the equity release?

This is possible if you release equity with a redemption option. The majority of lifetime mortgage providers will allow you to make flexible repayments but there are some plans without early repayment Charges. Make sure you ask your adviser to look for these if they are a priority. The majority of lifetime mortgages have early Repayment Charges normally until the youngest person reaches age 88.

Will I be able to leave an inheritance?

The difference between the proceeds from the house's sale and the amount owed on the plan when it is redeemed will be the amount of inheritance available. We can't predict what your property will be worth when it's sold in the future, so we can't predict what inheritance will be available. Some policies have an inheritance insurance feature that allows you to protect a certain amount of the property's future value. If one of your top goals is to protect an inheritance, your solicitor will discuss this with you.

What costs are involved when setting up a plan?

There are four main costs associated with equity release.
  1. Advice fee
At Mortgage Saving Experts, we don't charge any consultation fees.
  1. Valuation fee
This is payable when you submit your application and usually depends on the estimated value of your property.
  1. Legal fee
We recommend that you agree to a fixed fee with your solicitor once your equity release offer is confirmed. Legal fees vary, but a typical fee all in will cost around £2000 . If you’re purchasing a property or your property's legal position is not straightforward, additional costs may apply.
  1. Application fee
Some lenders may charge an application fee. Where this is the case, it can vary from lender to lender and interest rate product to product.

Will I be able to keep my home?

Yes, if you follow the terms of your arrangement, you can continue to own your house. All arrangements that meet the Equity Release Council's expectations guarantee lifelong tenure in your home, regardless of potential interest rates, property prices, or investment returns.

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Want to know more?

For more details, call our Mortgage Saving Experts today.

Want to know more?

Get in touch with of our mortgage saving experts today to find out how we can help.

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