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Equity Release
Find out how much tax-free cash you could unlock from your home. Use our guide to understand what affects your equity release amount, then get a personalised quote from a qualified advisor.
The amount you can release depends on your age and your property value. As a general guide, homeowners aged 55 can typically release around 20-25% of their home's value, rising to 40-50% or more by age 75. On a property worth £300,000, that means releasing between £60,000 and £150,000 depending on your age.
Interest rates on lifetime mortgages currently range from around 5.5% to 7.5% MER (monthly equivalent rate). Because interest compounds over time, the total amount owed can grow significantly. On a £80,000 lump sum at 6% over 15 years, you would owe approximately £191,000. Most plans now include a no-negative-equity guarantee, meaning you will never owe more than your home is worth. A qualified equity release advisor can provide a personalised illustration based on your exact circumstances.
Sources: Equity Release Council Spring 2026 Market Report, Bank of England base rate data (July 2026)
An equity release calculator estimates how much tax-free cash you could unlock from your home without selling it or making monthly repayments. You enter your age (or the youngest homeowner's age if you're a couple), your property value, and any outstanding mortgage balance. The calculator then applies lender criteria to produce an indicative figure.
The calculation is based on loan-to-value (LTV) tables that lenders use. These tables set the maximum percentage of your property's value you can borrow, increasing with age. A 55-year-old might access 20-25% LTV, while a 75-year-old could access 40-50% LTV. If you have an existing mortgage, that balance is deducted from the amount available, since equity release pays off your current mortgage as part of the process.
For example, if your home is worth £350,000, you're 65, and the maximum LTV is 33%, the calculator would show approximately £115,500. With a £40,000 outstanding mortgage, you'd receive around £75,500 as a tax-free lump sum after clearing that balance.
Several factors influence your maximum release amount. Your age is the most significant: the older you are, the more you can borrow. This is because lenders expect the loan to be outstanding for a shorter period before the property is sold. For joint applications, lenders use the age of the youngest applicant.
Your property value sets the upper limit. Lenders typically require a minimum property value of £70,000, though some set the threshold higher. The property must be your main residence in the UK, and certain construction types (such as concrete prefab or properties with significant structural issues) may not qualify. Location also matters, as different equity release providers have varying geographic criteria.
Health and lifestyle conditions can actually increase your release amount. If you have certain medical conditions, smoke, or have a high BMI, some lenders offer enhanced plans with higher LTV ratios. This is because these factors reduce life expectancy, meaning the loan is likely to be repaid sooner.
These are broad estimates. Actual amounts vary between providers and depend on current lifetime mortgage rates at the time you apply. Even small differences in interest rates affect the maximum LTV a lender will offer.
With a standard lifetime mortgage, you make no monthly repayments. Instead, interest is added to your loan balance each month. Because you pay interest on interest, the amount owed can grow quickly over time. Understanding this compounding effect is essential before committing to equity release.
The speed at which your debt doubles depends on the interest rate. At 5.5%, your loan roughly doubles in 13 years. At 7%, it doubles in about 10 years. This is why it is important to compare equity release costs carefully and consider the long-term impact on your estate.
All Equity Release Council-approved plans include a no-negative-equity guarantee. This means you (or your estate) will never owe more than the property is worth when it is sold, regardless of how much interest has accumulated. Some plans also let you make voluntary interest payments to control the balance, which can significantly reduce the total cost. Ask your advisor about the pros and cons of equity release before proceeding.
When using an equity release calculator, you will typically see two options: a lump sum lifetime mortgage or a drawdown lifetime mortgage. The choice between them significantly affects how much interest you pay over the life of the plan.
With a lump sum plan, you receive the full amount upfront and interest starts compounding on the entire balance immediately. With drawdown, you take an initial sum and keep the rest in a cash reserve facility. You only pay interest on the money you have actually withdrawn, not on the reserve. This can save tens of thousands of pounds over the life of the plan.
A drawdown plan works particularly well if you need funds for ongoing expenses rather than a single large purchase. Your advisor can model both scenarios to show you the long-term difference in cost based on your specific needs.
Online calculators provide useful estimates, but they have limitations. They use generalised LTV tables rather than individual lender criteria, and they cannot account for health conditions that might increase your amount through enhanced plans. The property value you enter is your own estimate, not a professional valuation.
A qualified equity release advisor will search the whole market, factor in your health and lifestyle, and provide a personalised illustration that shows the exact amount available from specific lenders. This illustration is a regulatory requirement and includes projections showing how interest will accumulate over time. Before speaking to an advisor, it helps to understand what equity release is and how it works so you can ask informed questions.
You should also consider whether alternatives to equity release might suit your situation better. A good advisor will discuss all options, not just equity release products.
Getting your quote
Check your eligibility
Confirm you meet the basic requirements: aged 55 or over (the youngest homeowner on joint applications), owning a UK property worth at least £70,000. Most property types qualify, though some non-standard constructions may be excluded.
Estimate your property value
Check recent sold prices for similar properties in your area using the Land Registry. Your advisor will arrange a formal valuation, but having a realistic estimate helps you understand your likely options from the outset.
Speak to a qualified advisor
Equity release advice is a legal requirement. Your advisor will assess your full financial picture, search the whole market, and explain how different plans affect your estate and any means-tested benefits you receive.
Review your personalised illustration
Your advisor will provide a Key Facts Illustration showing the exact amount available, the interest rate, projected balance over time, and all fees. You have a 14-day reflection period before committing.
Receive your funds
Once you proceed, a solicitor handles the legal work. Funds are typically released within 6 to 8 weeks of your initial application. Any existing mortgage is paid off automatically as part of the process.
Equity Release
A qualified advisor will search the whole market and provide a personalised illustration based on your age, property, and health. There is no obligation to proceed.
Key considerations
You must be at least 55 to take out a lifetime mortgage, which is the most common type of equity release. For home reversion plans, the minimum age is typically 65. On joint applications, the youngest homeowner must meet the age requirement.
Yes. The equity release plan pays off your existing mortgage first, and you receive the remaining balance as tax-free cash. Your outstanding mortgage simply reduces the amount available to you. Many people use equity release specifically to clear their mortgage and stop monthly payments.
With a lifetime mortgage, yes. You retain full ownership and the right to live in your home for life. The lender has a charge on the property, similar to a standard mortgage. With a home reversion plan, you sell part or all of your home but retain the right to live there rent-free.
No. The money you receive from equity release is a loan, not income, so it is not subject to income tax or capital gains tax. However, releasing a large sum could affect your inheritance tax position and eligibility for means-tested benefits.
Many modern lifetime mortgages allow voluntary partial repayments, typically up to 10% of the original loan per year without penalty. Making repayments reduces the interest that compounds, which can significantly lower the total amount owed over time.
The process typically takes 6 to 8 weeks from initial application to receiving funds. This includes the property valuation, legal work, and the mandatory reflection period. Complex cases or delays in legal searches may take longer.
When the last surviving borrower dies or moves into long-term care, the property is sold and the loan plus accumulated interest is repaid from the proceeds. Any remaining equity goes to your estate and beneficiaries. The no-negative-equity guarantee ensures your estate never owes more than the sale price.
Yes. If you have certain medical conditions, smoke, or take regular medication, you may qualify for an enhanced lifetime mortgage. These plans offer higher loan-to-value ratios because the lender expects the loan to be repaid sooner, meaning you could release more cash.
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Equity Release
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