Equity Release Solicitors

Equity release is a financial arrangement that allows homeowners aged 55 and over to access some of the equity that is tied up in their property without having to sell it. The amount of equity that can be released depends on several factors, such as the value of the property, age of the homeowners, and criteria of the lender.

Equity release schemes are a highly regulated and safe option for most individuals. As with any financial arrangement, there are some things to consider before you decide to go ahead. 

For example, you will need to consider the future impact on your finances and eligibility for means-tested benefits, among other factors. Working with a reputable equity release firm such as Setfords can help guide you through the entire process. You may also want to seek independent financial advice to get a better understanding of how your financial situation could impact your decision.

Criteria can vary between lenders, but in general the criteria for equity release will look something like this:

• Homeowners must be at least 55 years of age, or 65 years of age for home reversion plans.
• If the plan is being taken out jointly, both people must reach the age criteria.
• The property must be worth £70,000 or more.
• Your home must not have an existing mortgage, otherwise the funds or savings must be used to pay the existing mortgage off.
• Some lenders may insist that you do not have any dependents living with you.

Releasing equity from your home is not the same as selling so you will still own your home, but there are some things to bear in mind. 

With a lifetime mortgage, you will retain full ownership of your home. The loan will be repaid upon your death or move into long term care. The home is usually sold to provide the proceeds for this. 

Meanwhile, with home reversion plans, you agree to sell a certain percentage of your home to the lender. As such, they are entitled to a percentage of the property’s sale proceeds, but you retain ownership of the rest.

You can use the equity released from your home for all kinds of purposes. For example, home improvements, to supplement your retirement income, to clear outstanding debts, to travel, to pay for care, or to provide financial assistance to family members.

Put simply, equity release can be used to fund most things. However, the lender may have criteria you will have to adhere to for some purposes, such as not using the funds to buy another house. Your equity release solicitor will be able to advise you further, taking your own circumstances into account.

In many cases, it is still possible to sell your house if you have released equity on your property. However, you will need to redeem the mortgage associated with the equity release, which is likely to incur an early repayment charge. You may also be able to transfer the mortgage to another property, but this might be subject to further criteria set by the lender. 

Your equity release solicitor will be able to give you more information, depending on your specific circumstances.

Yes, it is possible to release equity in your home if you have an existing mortgage that hasn’t been paid off. However, you will need to meet all of the equity release lender’s criteria, which typically involves using part of the released funds (or other savings) to pay off the existing mortgage. Please contact an equity release solicitor for more advice.

Yes, consulting independent legal advice is a requirement for the equity release process. 

Please get in touch with our expert equity release solicitors to discuss your options and inform you of any potential issues, so you can make an informed decision about whether an equity release is right for you.