Equity release can be used for any legal purpose. Typically, clients use the funds to:

• pay for home improvements
• pay off an existing mortgage
• house purchase
• holidays
• cars
• debt consolidation
• gifts to family
• topping up income

There is a minimum loan amount of £10,000, a minimum property value of £70,000 and no maximum for either.

The amount of equity that can be released will vary from lender to lender and will be based several factors:

• The value of the property.
• The age of the youngest homeowner.
• The health and lifestyle of the homeowner (s).
• Whether the applicant has full ownership of their property.  If there is an  outstanding mortgage or loan secured against the property, this will be deducted from the maximum amount that can be released.
• The overall condition of the property and the type of construction.

There are no upfront fees to pay with Ramsay & White and our advisors are happy to help you with a free consultation.

The process works as follows:

1. Our advisors will carry out a quick and easy consultation to find out more about your circumstances.

2. From here, they will find the best product on the market to suit your needs and help you complete the application process.

3. A valuation of the property will then need to be carried out by a local surveyor who will create a valuation report for the lender. This will determine how much equity can be released.

4. An equity release solicitor will take care of the legal process and liaise with the lenders’ solicitor.

5. Once the conveyancing and the legal process has taken place, you will receive an offer from the lender along with a Solicitor’s Certificate. 

6. Once the final checks and the legal paperwork is complete, a completion date will be set.

7. The funds released are first sent to your solicitor who will deduct any charges before forwarding the net amount onto you. 

The interest applicable rolls up, so adds to the balance over the course of the mortgage. This means there is compounding as the balance on which the interest is calculated increases. However, most products are offered on a lifetime fixed interest rate, giving you certainty.

The interest applicable can be paid in one of the four ways:

• In full on sale of the property should you pass away or move permanently into long-term residential care, concluding the natural end to the mortgage term.
• In full by way of sale/lump sum/re-mortgage, and thereby concluding the mortgage term early.
• Incrementally by setting an interest serviced product – you can set up monthly payments from £25 to the full interest applicable each month.
• You can typically overpay by 10% per year covering capital and interest by making overpayments. Some products even allow up to 12%, 15%, 20% and 40% per year overpayment based upon the initial balance.

You can take an initial lump sum, and if this would be appropriate for you, set up a drawdown facility. You can draw down from this facility in amounts as small as £500 per time.

Equity Release has been available as a form of releasing equity from property for the over 55s in various shapes and forms since 1965.

There are various safeguards in place, imposed by our industry trade body – The Equity Release Council, such as:

• Being able to take the mortgage with you to a new home
• Being able to pay it off early
• No negative equity guarantee
• Face-to-face legal advice for all
• Right to live in the home for the rest of your life