No-nonsense Guide

Equity Release no-nonsense guide

No annoying jargon, just clear and helpful information

What is Equity Release?

Equity Release is a way of freeing up some of the cash (equity) tied up in your home to enjoy a retirement to remember. The tax-free money you release is yours to spend as you wish, whether that’s for home improvements, holidays or helping your family.

Depending on the plan you choose, the money can be released in one lump sum or smaller amounts over time. The amount you can borrow depends on the plan you choose, your age, the value of your home and the equity available.

How do I qualify?

To qualify for Equity Release you (or both you and your partner) must be over 55 years old, must own your own home (worth at least £70,000) and live in mainland UK or Northern Ireland. Your home must also be a residential property of standard UK construction.

Will I still own my own home?

With the Equity Release Mortgages (Lifetime, Drawdown and Interest Only) you still own your home; you are simply borrowing money against it. If you choose the Home Reversion Plan the ownership of all or part of your home is transferred to the lender. In all cases you continue to live in your home until you die or move into permanent care.

What are the options?

There are four main types of Equity Release:

Lifetime Mortgage: One lump sum borrowed against the value of your home.
Drawdown Lifetime Mortgage: Smaller amounts borrowed over time against the value of your home.
Interest Only Mortgage: One lump sum borrowed against the value of your home, interest paid monthly.
Home Reversion Plan: Part or your entire home is sold to the lender for a lump sum.

For more information about each plan please visit our

Can I repay the loan early?

If you choose to repay your loan earlier you will normally have to pay an early redemption fee. Some plans allow you to make monthly, ad-hoc or partial payments so it’s worth discussing this with your Adviser.

How is the loan repaid and who sells my home?

For all Equity Release Mortgages (Lifetime, Drawdown and Interest Only) the loan is repaid upon the sale of your home. This is usually after you die or move into permanent care and is taken care of by your beneficiaries. All interest accrued under Lifetime and Drawdown Lifetime Mortgages are also repaid at this time.

When you take out a Home Reversion Plan things are slightly different. If you choose to sell your entire property then 100% of the value goes to the provider upon sale. If however you sold 50% of your home when the property is sold 50% of the value goes to the provider and 50% (minus costs) to your family or stated beneficiaries. The provider generally arranges the sale of your home.

Can I move house?

All Equity Release plans can be moved from property to property but some are easier to move than others. Your Adviser will discuss the best options with you.

What about my benefits?

If you receive means tested state benefits (Pension Credit or Council Tax Benefit) releasing equity from your property could affect this. There’s no need to worry though, we will perform a free state benefit entitlement report so that you know exactly if and how your benefits will be affected. We’ll also advise you on the best way to avoid any reduction in your benefits.

Impartial expert advice – 01872 859 414

Call Giraffe equity release on 0800 622 6414 or send an enquiry here