Speak to our experienced equity release solicitors today for clear, practical advice on releasing equity from your home safely and with confidence. Call 0800 086 2929, email info@elitelawsolicitors.co.uk or complete our Free Online Enquiry Form to book a free initial consultation.
Equity release is becoming an increasingly popular option for homeowners aged 55 and over who want to access capital from their property without immediately selling or moving home. It may be used to repay existing borrowing, fund home improvements, support children or grandchildren, or provide additional income in later life.
Because equity release is secured against your home and can affect your estate, inheritance plans, entitlement to means-tested benefits and future care arrangements, it is important to understand the legal and financial implications before proceeding. You should always speak to an independent financial adviser or broker before choosing an equity release product.
For more detailed guidance on the process, benefits and key considerations, please read our guide to equity release from your home.
What is Equity Release?
Many people have heard of the term equity release but are less sure about what it is and what it encompasses. Put simply, equity release allows you, as a homeowner, to release some of the equity that is tied up in your house to generate a lump sum payment or an income stream once you are over the age of 55.
To benefit from equity release, the property you own must be based in the UK and be your main dwelling. In all cases, your property will need to be in a “reasonable to good” state and only some types of property will be eligible for equity release.
The property should also be worth more than a certain stated value, although this will change depending on the type of property you own and what condition it is in.
If you would like to discuss your circumstances or requirements with one of our experienced equity release solicitors please call us on 0800 086 2929, email info@elitelawsolicitors.co.uk or complete our Free Online Enquiry Form to arrange an initial consultation.
How does Equity Release work?
With equity release, you are able to retain your home and continue to live in it for a set amount of time (usually agreed until death or when you move into long term care) while receiving either one payment close to the value of your property, or several payments over the course of many years.
There are two types of commonly used equity release plans:
- Lifetime mortgage equity release
- Home reversion equity release
What are Lifetime Mortgages?
Lifetime Mortgages are by far the most common kind of equity release product and are regulated by the Equity Release Council. Homeowners can retain full ownership of their home, and the fixed interest payments on the loan can either be repaid and or rolled up.
This means that the interest does not need to be regularly repaid but can instead continue to accrue until the mortgage and interest are repaid in full upon the eventual redemption of the loan.
When it comes to a lifetime mortgage, this will need to be repaid usually when your home is sold after your death, or if your home is sold and you need to make a move into a residential care facility.
What is Home Reversion Equity Release?
Home reversion equity release is when you will gain funds from either selling part or all of your property. You will be able to continue residing in your home until your death or if you need to move into residential care on a permanent basis. If you are taking out equity release with your partner, then this is usually following the death or a move into residential care of the last surviving person.
Who can benefit from Equity Release?
There are some specific rules relating to who can benefit from equity release, beyond simply being over the age of 55. If you wish to take out a lifetime mortgage, this is the main requirement, however, if you wish to pursue the home reversion plan route, you must be at least 65 years of age. If you are taking out either of these equity release plans jointly, you must both reach the required age to pursue the relevant plan.
If you have an existing mortgage on your property, equity release may still be possible, though this will be dependent upon the amount you still owe. You will need to pay the balance of any mortgage or secured loan when you complete equity release.
Equity release may not be suitable if you have dependents living with you, but as long as they have no legal attachment to the home, an equity release solicitor can help you to examine your options. Your dependents will be required to take independent legal advice. Should they need to continue living with you, they will need to confirm that they understand that they have no legal rights to the home and cannot live there after you have passed away.
Advantages and disadvantages of Equity Release
Equity release can be a complicated process and has many pros and cons. Each type of equity release has its own advantages and disadvantages, as outlined below.
Advantages of Equity Release
The main advantage of equity release is that you can receive an untaxed amount of money (either in one large amount or multiple small amounts) that can help to supplement your ongoing income or support your retirement without needing to move out of your home. It is also possible that you can benefit from the property increasing in value as you continue to live in it.
When it comes to a lifetime mortgage, a significant advantage is being able to retain ownership of your property and continue to live there.
Should your property become unsuitable for you to live in, you can, in some circumstances, transfer your equity release to another property. However, there are some caveats and conditions attached to this which will be unique to your circumstances and property.
Disadvantages of Equity Release
One disadvantage is that equity release may not be appropriate if you are living with dependents. It is still possible to pursue equity release in these circumstances, but your dependents would need to pursue independent legal advice of their own should they wish to remain in your home.
In such a scenario, there is sometimes the option of dependents signing a waiver to state that they will need to move out once you have passed away or moved into a residential care facility permanently.
It is not possible for family members to inherit your property after your death if you have taken out equity release (unless they wish to repay the full amount owed to the lender at the time from other resources). In fact, equity release diminishes your estate’s overall value, as your property is essentially taken out of the equation.
Should you choose a home reversion plan, the company you take out the plan with will own part or all of your home, which means you are no longer the property owner.
Finally, you may find that having the extra money could reduce your access to means-tested benefits and could result in higher care costs should you require home help funded (in part or full) by your local council.
Do I need to instruct Equity Release Solicitors?
When pursuing equity release, you will need independent legal advice. This can be provided by specialist equity release solicitors and is a requirement of the equity release process.
You can discuss your best options about instructing a legal professional with your financial adviser at the beginning of the equity release process.
At Elite Law Solicitors, our experienced team of conveyancing solicitors regularly represent homeowners taking out Lifetime Mortgages. We are familiar with lenders’ usual requirements, so can identify any possible issues early on in the transaction.
If you would like to discuss your circumstances or requirements with one of our experienced equity release solicitors please call us on 0800 086 2929, email info@elitelawsolicitors.co.uk or complete our Free Online Enquiry Form to arrange an initial consultation.
How do I choose an Equity Release Solicitor?
How you choose an equity release solicitor will depend on several factors. If you have an existing connection to a solicitor, you should check with a financial adviser whether they are, or have to be, on the panel of the equity release lender.
They will research and advise you whether your nominated solicitor is on their panel and meets their specific requirements. If not, they will be able to advise you as to which equity release solicitors are on their panel. It is, however, at your discretion which solicitor you choose to deal with the equity release process.
What does a Solicitor do during the Equity Release process?
Equity release solicitors are familiar with the process and can foresee any potential pitfalls or ways in which the process may be slowed down, ensuring that your equity release is as fast and beneficial to you as possible.
When you instruct a solicitor to deal with the equity release process you will be required to sign certain declarations confirming that:
- You understand the implications of taking out the equity release; and
- You will continue to insure and maintain your property and submit all the documents required by the lender to the lender’s solicitors to enable the funds to be released.
How long does Equity Release take?
Equity release will usually take around two months to complete, however, this is based on a straightforward process. If your personal circumstances are more complicated, this could take considerably longer, stretching out into several months.
If the title to your property is not in order, or if it is still unregistered land, the procedures could take a little longer.
Once the loan offer is made the lender will usually require you to complete the equity release before a certain number of days, usually around 50. If the mortgage offer expires before the process is completed, the lender may issue a new mortgage offer with the help of your broker if you still fit into their lending criteria; however, some of the conditions, such as the interest rates payable, may change.
How much do Equity Release Solicitors charge?
Equity release solicitors will charge advice fees during the equity release process. They may charge their fees based on the total amount of your loan, charging a percentage amount of between 1.5% and 2%. You should bear this in mind when consulting with equity release solicitors on larger loans.
At Elite Law Solicitors, we favour quoting fixed fees, which will only change if the requirements of the lender change through the process or if due to unforeseen circumstances the process is taking longer than expected.
To obtain a free quote get in touch with one of our specialist equity release solicitors by calling 0800 086 2929, emailing info@elitelawsolicitors.co.uk or completing our Free Online Enquiry Form.
Equity Release Solicitors: How we can help
At Elite Law Solicitors, we have a specialist team of equity release solicitors who regularly act for homeowners taking out Lifetime Mortgages.
We are familiar with lenders’ usual requirements, so can pre-empt any possible issues early on in the transaction. This helps to avoid any delays or difficulties further down the line.
The legal process always involves a face-to-face or virtual meeting between the lawyer and the homeowners. The purpose of this meeting is for the lawyer to advise you on the legal process, and to witness signatures to the security documentation. We are always willing to meet homeowners either at a convenient office location, or at their home.
Our expert equity release solicitors can deal with the legal aspect of the equity release process in an efficient and professional manner. We are independently regulated by the Solicitors Regulation Authority and our accreditation through the Law Society’s Conveyancing Quality Scheme attests to our skill and expertise in this area of law.
Once you make an initial enquiry, one of our experienced equity release solicitors will arrange an initial consultation with you, free of charge, to explain the legal process to you.
Once we understand your circumstances better, we can provide you with a clearer understanding of how we can help you. We will also provide you with a price quotation and a choice of funding methods at the outset.
Book your Consultation with Equity Release Solicitors
Call 0800 086 2929, email info@elitelawsolicitors.co.uk or complete our Free Online Enquiry Form to arrange an initial consultation and let one of our experienced equity release solicitors explain your legal rights and options.
Equity Release Solicitors: Frequently Asked Questions
Can equity release solicitors advise me before I accept a lifetime mortgage offer?
Yes. Equity release solicitors can explain the legal implications of a lifetime mortgage offer before you sign the lender’s documentation. While your financial adviser will advise on whether the product is suitable from a financial perspective, your solicitor will check that you understand the legal responsibilities, restrictions and long-term effect on your property.
Why is independent legal advice required for equity release?
Independent legal advice is an important safeguard in the equity release process. It helps ensure that you understand how the arrangement affects your home, your obligations to the lender and the circumstances in which the loan may need to be repaid. This legal advice is separate from financial advice and is designed to protect your interests before completion.
What documents will I need for an equity release solicitor?
Your equity release solicitor will usually need proof of identity, evidence of your address, details of your existing mortgage or secured loans, buildings insurance information and the lender’s formal offer. Depending on the title to your property, further documents may also be required to satisfy the lender’s legal requirements.
Can I use equity release if my property is leasehold?
Equity release may be available on a leasehold property, but the lender will need to be satisfied with the remaining length of the lease and the terms affecting the property. Solicitors for equity release will review the lease, check for any restrictions and raise any issues that could delay or prevent completion.
Will equity release affect my will or estate planning?
Equity release can affect the value of your estate because the loan and any interest will usually be repaid from the sale proceeds of your home. If you are also reviewing your will, inheritance planning or arrangements for family members, it may be sensible to take joined-up legal advice so that your wider estate planning reflects the equity release arrangement.
Can an equity release solicitor help if there is a restriction or defect on my property title?
Yes. If a title issue is identified, such as a missing document, an old restriction or a boundary concern, your solicitor can advise on the steps needed to resolve it. Addressing title issues early can help reduce delays with the equity release legal process and improve the likelihood of satisfying the lender’s requirements.
Do all owners of the property need legal advice for equity release?
Where a property is jointly owned, all legal owners will normally need to be involved in the equity release transaction and receive appropriate advice before signing the security documents. If another adult lives at the property but is not an owner, the lender may also require them to obtain independent legal advice or sign an occupier’s consent form.
Can I complete equity release remotely?
Many parts of an equity release transaction can be progressed by telephone, email or post, but there will still usually be a meeting with your solicitor to explain the mortgage documents and witness signatures. Depending on your circumstances, this may be arranged virtually, at an office or, where appropriate, at your home.
What should I ask equity release solicitors before instructing them?
Before instructing equity release solicitors, it is sensible to ask whether they regularly deal with lifetime mortgage transactions, whether they can act for your chosen lender, how fees will be structured and how quickly they can arrange the legal advice meeting. Choosing a solicitor with relevant experience can help the transaction progress more smoothly.
Can equity release be used alongside buying another property?
In some cases, equity release may be considered as part of a wider property transaction, such as downsizing or purchasing a more suitable home. The legal work can be more involved because your solicitor may need to coordinate the purchase, lender requirements and equity release documentation within the same timetable.
When should I contact equity release solicitors?
You should usually contact equity release solicitors once you have spoken to an independent financial adviser and are considering a specific equity release product. Early legal advice can help identify practical issues with your property, title or documentation before they cause delay. To discuss your circumstances with our experienced equity release team, please contact Elite Law Solicitors for an initial consultation by calling 0800 086 2929, emailing info@elitelawsolicitors.co.uk or by completing our Free Online Enquiry Form.
