Equity Release on Second or Holiday Homes

Older Couple relaxing In their Home Abroad-min


While most lifetime mortgage plans focus on your main residence, there are a number of lenders who will offer equity release against second homes or holiday homes. We also work with a number of lenders who offer specialist buy-to-let products – you can view those by clicking on our buy-to-let equity release page here.

On this page we’ll aim to give you a detailed explanation of how lifetime mortgages work when you’re aiming to free up equity from a property that’s not your main residence – as well as answering some questions and giving you some ideas of how to take the next step if a second or holiday home plan sounds like the right one for you.

What is a Second or Holiday Home Plan?

A second or holiday home equity release plan isn’t a specific product as such, instead, it’s could be a series of products that have been adapted by lenders to meet the needs of people who have equity in an additional property. These lenders will generally offer a variety of products that might be suitable for you and your circumstances, including:

The range of lenders who offer products for second or holidays home is currently limited – but it’s growing all the time – and because of our exceptional relationships with specialist lifetime mortgage providers, we’re always able to offer you the very latest and best plans.

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Am I eligible for a Second or Holiday Home Plan?

The eligibility criteria for a second or holiday home equity release plan are slightly different to that of a more typical lifetime mortgage.

Firstly, an applicant must be a minimum of 55 years old – but also no older than 90. The property should be worth in excess of £70,000 – but generally no more than £6 million. Second or holiday home plans are currently only available for properties located in Scotland, England or Wales.

The use of the property is also significant too…

How is your property used?

While the idea of how you use a second home or holiday home might change depending on your needs or plans at any one time, a lender is more likely to need a solid definition to be adhered to for equity release purposes.

A property that is owned and used for holidays or as a second residence shouldn’t be advertised in any way or through any platform that would indicate that it’s available for let. It should not carry any signage or indication that it is available for let.

What’s more, a holiday home or second home should not be geographically close to the owner’s main place of residence and it should be used for a minimum of 4 weeks each year by the owners.

The specifics of your plan might be slightly different depending on the lender or product you choose – but don’t worry, one of our expert advisors will help you choose something that’s absolutely perfect for you and how you use your second home.

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How Much Can I Borrow?

The size of the lump sum payment that you can access when releasing equity from a second home might change slightly versus a main residence. The exact figures depend on your age and the property value – as well as the perceived risk lending against a second property by a lifetime mortgage company.

The calculations can be complex – but we’re happy to do them for you so you get an idea of what you could release. You can call us at a time that’s convenient to you and we’ll be able to talk you through figures that are specific to you and your property. Get in touch by calling 0131 644 3664 or 0333 360 1958.

Current LTVs (Loan-to-Values) – Source: Canada Life June 2019

AgeOver 55s Buy-to-Let Lifestyle
5514%

56

15%

57

16%

58

17%

59

18%

60

19%

61

20%

62

21%

63

22%

64

23%

65

24%

66

25%

67

26%
AgeOver 55s Buy-to-Let Lifestyle
6827%

69

28%

70

29%

71

30%

72

31%

73

32%

74

33%

75

34%

76

35%

77

36%

78

37%

79

38%

80-90

39%

Would you like to hear a little more?

If you have a second home or a holiday home and would like to hear a little more about equity release products that would suit your situation, we’d recommend calling us to discuss your situation in a little more detail.

You can be assured that when you call, you’ll be talking to an expert advisor that’s got an excellent knowledge of the second or holiday home lifetime mortgages that we can arrange. What’s more, you can rest easy knowing that we only work with lenders and products that have passed the stringent guidelines of the Equity Release Council.

At Equity Release Scotland we promise that you’ll never be put under any pressure to make a decision – and there’s never any obligation to do more than just have a chat about what might be right for you. It’s this promise that sees most of our business done as ‘word-of-mouth’ referrals from previous delighted customers.
Feel free to get in touch with us by calling 0131 644 3664 or 0333 360 1958 – we’ll answer all your questions and talk you through the opportunities available to you.

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Equity Release - Benefits

Tax

There may be some tax implications that you need to take into consideration, but these will vary on an individual basis.

Advice

If and when you decide to move forward with your application, our team of advisors will assist you and answer any further questions you might have.

Assistance

Take you time and don’t ever be rushed into making a decision, whatever your requirements Equity Release Scotland will be there to assist you every step of the way.

Frequently Ask Questions

Once the money has been released to you, the choice on what to spend it on is entirely up to you. There are no restrictions whatsoever (provided it is legal!). So whether you want to go on a round the world trip, buy a new car, or simply pay off other debts, the choice is entirely yours.

Absolutely, that is one of the major benefits of this type of scheme, and it in our opinion is one of the more important foundations upon with the agreement is built. There is little point in removing the financial stress, if a few years down the road you are concerned about losing your home. In fact, not only are you entitled to remain in the home for the rest of your life, but so is anyone else mentioned in the agreement.

If everything goes according to plan, then it is entirely feasible for the money to be released to you between three and four weeks. However, always err on the side of caution and plan on the entire process taking up to eight weeks. The length of time is not entirely under our control, and can take even longer if your solicitor is unfamiliar with equity release schemes for instance.

When you sign the contract, you are simply agreeing to another style of mortgage, so the ownership of the property remains with you.

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To get more advice and information, please fill out the form and we will be call you back.

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Our Guarantees

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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