Equity release is a way to access the equity in your property without having to give up ownership. There are two main types of equity release: lifetime mortgages and home reversion plans.
With a lifetime mortgage, you can borrow against the value of your property, receiving either a lump sum or regular payments, without the need to make any repayments until you pass away or sell your home. The loan is secured against your property, which means that the lender has a charge over it.
On the other hand, a home reversion plan involves selling a portion of your property to a provider for a lump sum or regular payments. You still have the right to live in your home, but the provider owns a share of the property, which they can sell when you pass away or move out. This can be a useful option for those who prefer not to borrow against their property or want to have a guaranteed amount of equity released.
Sunny Avenue has created this tool to provide an idea of when you can access the equity in your property based on your age and property value. Please note that the tool is meant to be used as a guideline. If you would like to find out exactly how much you can borrow, you can request advice from an equity release adviser using our directory or the Sunny Fact Find tool for Equity Release advice. The fact find uses the answers you provide to help find your ideal adviser, who will then contact you to explain how they can help and answer any questions you may have. You decide how to proceed.
Different lenders use different formulas to calculate the equity release amount. As a result, it can be difficult to provide a confirmed figure, as some lenders may prioritise competitive edge over others. At Sunny Avenue, we have used available data to provide an approximation of the equity release amount. Please note that lenders will typically set a specific maximum percentage available based on the age of the youngest borrower.
The amount of equity you can release depends on two main factors: your age and property value. To find out how much equity you could release on a lifetime mortgage, simply input these two figures below and click on 'Calculate'. The answer provided will give you an idea of how much you may be able to release.
For more information on Equity Release, review our Equity Release insight page: Equity Release Insights from the Experts
While age and property value remain the primary influencers, there are other considerations to bear in mind. Firstly, your age plays a significant role as younger individuals can borrow less due to the longer repayment period lenders anticipate. Health is another aspect that can impact the borrowing amount, as individuals with medically underwritten plans may release more equity if their health indicates a shorter life expectancy. Additionally, outstanding debts, such as mortgages and secured loans, must be taken into account, as lenders may require their repayment before approving an equity release plan.
When it comes to a home reversion plan, it's possible to release up to 100% of your property value. However, it's crucial to note that the actual amount you receive may be considerably lower than the market value. This is because lenders typically offer a reduced value for the equity released. It's important to be aware that choosing a home reversion plan means selling your home and becoming a tenant. When using a home reversion calculator, keep in mind that it may not provide an accurate estimate of the borrowing potential. Therefore, it's advisable to seek professional advice and thoroughly evaluate all aspects before proceeding with an equity release plan.
Use our Equity Release Calculator without personal details to provide an estimate decision on how much equity you can release. This Equity Release Calculator takes into account your age and property value.