Written by Mark Langshaw Reviewed by Lee Trett
22 January 2026
Hub page introduction, criteria and FAQs added
12 December 2024
First Published
A quick overview of equity release
Equity release is a type of finance, similar to a mortgage, that allows homeowners aged 55 or older to unlock the cash tied up in their property without the need to sell. This provides a tax-free lump sum that can be used to boost retirement income, fund major expenses like a dream holiday, or help children get on the property ladder.
You can read more about how it works in our complete guide to equity release.
How equity release is different to a regular mortgage
The differences between equity release and a standard residential mortgage are as follows:
-
Equity release is specifically designed for older borrowers
-
There are no mandatory monthly payments
-
Enhanced terms are available for those with serious health conditions
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You must be a homeowner to qualify for equity release
|
Property Value |
Age (based on youngest homeowner) |
Amount you could release |
Maximum loan-to-value (LTV) |
|
£250,000 |
65 |
£107,500 |
43% |
|
£500,000 |
60 |
£190,000 |
38% |
|
£750,000 |
70 |
£360,000 |
48% |
|
£1,000,000 |
55 |
£310,000 |
31% |
How much equity you can release
The main factors that determine the amount of equity you can release are your age, the property value and the loan-to-value ratio. The older you are, the more you can typically release. This table shows how the amount varies based on these variables.
Guides & articles
All about Equity Release
Guide
Later Life
A Complete Guide to Equity Release
All you need to know about lifetime mortgages & revision plans
Later Life
How to Get Equity Release With a Bad Credit Rating
Your guide to bad credit equity release
Later Life
Can I Use Equity Release To Buy A Second Home?
Find out if an equity release mortgage can help you buy another property
Later Life
How Much Equity Release Can You Get?
A breakdown of what you can borrow & the costs
Later Life
Equity Release: Pros, Cons & Alternatives to Consider
The advantages and disadvantages of equity release schemes
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Equity Release in Scotland
A complete guide to Scottish equity release schemes
More articles related to Equity Release
No, the cash you release is tax-free. However, if you invest that money, any income or interest generated from the investment might be taxable. It’s important to discuss your plans with a financial advisor.
If you choose a plan from a provider that is a member of the Equity Release Council, you will benefit from the "No Negative Equity Guarantee." This ensures that you or your beneficiaries will never owe more than the value of your home when it is sold, even if the property market crashes.
Yes, but it can be expensive. Because these plans are designed to last for the rest of your life, early repayment charges (ERCs) can be significant. However, many modern plans now offer "downsizing protection" or fixed ERC periods, which can make leaving the plan cheaper after a certain number of years.
Connect with an equity release specialist today
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on a mortgage or any other debt secured on it.
If you are thinking of consolidating existing borrowing you should be aware that you may be extending the terms of the debt and increasing the total amount you repay.
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