Equity Release Calculator

How Much Tax Free Cash can I Release?

Using our Equity Release Calculator is free and will provide an indication on what you could release from your property and the types of plans available. There is no credit check and your data is kept safe using our secure systems. You can apply whether you've paid off your mortgage or not - but any outstanding mortgage will need to be paid off with the money you release. Remember, you need to be 55+ with a property worth at least £70,000 to be eligible

I'm   years old, and my    is worth around  

You could release up to £25,500

Call us FREE on 0333 360 1958 to check if you're eligible and schedule a Free Consultation with one of our local expert advisors.

The amount shown is only an indication, and isn't guaranteed. To calculate this amount, we compare your age and property value to our 'loan to value' table. This allows us to work out what percentage of your home's value is available to you.

What is Equity Release?

Equity Release is a way of borrowing/extracting tax free money on the existing equitable value of your home.  The most popular method is through a lifetime mortgage although there are other plans available such as home reversions, drawdown mortgages etc. You can view these on our Plans page.

It is only available to over 55’s with a minimum home value of £70,000. There are other terms that apply depending on the 3 parameters:

  • Property Type and Value
  • Location
  • Age of applicants (youngest home owner needs to be 55+)

What is an Equity Release Calculator?

An equity release calculator is a piece of software that will enable potential customers to get an estimate of how much equity they could release from their property. Not all calculators are identical, but in general, clients will have to answer two main questions:

  • The Estimated Value of The Property
  • The Age Of The Youngest Person With A Stake In The Property

Once the client has entered these details the calculator will provide a figure that they may be able to release and is subject to confirmation of the property value and the clients age(s).

What is an Equity Release Lifetime Mortgage?

An Equity Release Lifetime Mortgage is the most common way homeowners over the age of 55 release capital from their home. Once the prospective applicant’s individual circumstances have been fully assessed a suitable Lifetime Mortgage can then be recommended and an application to the lender formally made. A full professional survey, normally free of charge, is carried out on the property to confirm its market value.

The details regarding how much you can borrow, are directly related to the value of the property and the homeowner’s age at the time of the application. If it is a joint application the age of the youngest applicant is used. Some lenders also take into account the health of the applicants as enhanced borrowing can be permitted in some cases.

The loan works in a similar way to a standard mortgage except that there is no obligation by the client to repay the loan but many lenders offer the flexibility to repay up to 10% of the sum borrowed should the client wish to do so. If they elect not to make any payments during the life of the loan interest rolls up monthly. The loan is repaid when the clients either die or move into long term care. The house is simply sold and the surplus from the sale goes into the estate of the deceased.

The monies raised from an equity release loan on your home is free of any tax liability on the borrower. Advice should be taken on the impact it may have on inheritance, payment of care home costs and the impact it may have on entitlements to state benefits.

How Does Equity Release Work?

Equity Release works as a “finance vehicle” that allows you to “extract/release” some of the “tied up” cash that resides within the equity of your home. Example:

  • Your Home’s market value is £200,000.
  • You have no mortgage left to pay
  • You are 68
  • Using the above figures and given an average LTV (Loan to Value) available is 40.5%. This means that you could release £81,000 in tax free cash from your home.

The calculation of 40.5% of £200,000 is:

£200,000 divided by 100 (to find out how much 1% is) = £2,000 multiply by 40.5 = £81,000

How Much Tax Free Cash Can I Free Up?

The amount of cash you can free up from your property depends on your age, the value of your property and with some lenders any qualifying underlying health issues you may have. Money can be released as a lump sum on its own or as a smaller sum with a reserve or draw-down facility which can be used over time whenever the clients wish.

The money is absolutely tax-free and can be spent on whatever the clients need or desire. Clients with an existing mortgage or secured loan on their property will have to settle this first with the proceeds of the Equity Release loan, but you must first use this to repay in full any existing standard mortgage currently on your property.

The best way to find out how much cash you could receive for your particular circumstances is to use our free Equity Release calculator at the top of this page or speak to one of our fully qualified advisers.

What is the Equity Release Council?

The Equity Release Council is a not for profit organisation that is recognised as the industry body for equity release. The concept of the Equity Release Council is to manage and supervise the Equity Release Industry, setting up agreements, rules and regulations that are fair to both the lender and the homeowner.

What Percentage Can You Get on Equity Release?

The factors that contribute to what percentage you can get on equity release are the age of the youngest home owner, the property value minus any outstanding mortgage amount.

Lenders will typically lend between 20% and 60% of the total value of the property taking into account the above criteria. The average equity release loan is around 35%.

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Why you should always choose a product from a lender approved by the Equity Release Council

Guarantee 1

equity release council logo approvedYou have the Right to Remain in your Home for as long as you choose

Guarantee 2

equity release council logo approvedYou will NEVER owe more than the value of your home due to the "no negative equity" guarantee.

Guarantee 3

equity release council logo approvedYou have the freedom to move to another property without financial penalty (subject to provider criteria)

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