9 Best Equity Release Companies UK

If you’re at or reaching retirement age in the UK, you’ve likely come across the benefits and opportunities available through releasing equity from your property. It’s a fantastic tool if you need access to funds later in life to cover any expenses.

Perhaps you’re helping a loved one onto the property ladder or covering medical bills. Whatever the reason, it’s important to choose a reputable company with the best possible rates. To help guide you, here’s a list of 10 of the best equity release companies in the UK.

Aviva

The largest general insurance provider in the UK, with a long history of offering top insurance and pension products. Here is an overview of the company’s equity release services:

• You must be 55 years old or over. If you’re married or in a civil partnership, both need to be over 55. The company will use the age of the youngest to work out the release amount.
• The property you plan to use for equity release must be your primary residence.
• You don’t have a mortgage, or you’re close to paying it off.
• The property must be located in the UK and be worth at least £75,000.
• You need to release at least £15,000 (if the property value allows it).

The company offers two types of equity release products – Lifestyle Lump Sum Max and Lifestyle Flexible Option.

• Lifestyle Lump Sum Max: You receive a tax-free lump sum amount against the value of your property. It’s a great option if you have a one-off expense to pay or you want to put down a deposit on a second property.
• Lifestyle Flexible Option: You receive a small lump sum against your property and set up a cash reserve to withdraw from whenever you please. This option is excellent if you have regular expenses to cover, such as medical bills.

Nationwide

The world’s largest building society, Nationwide has been a reputable provider of insurance and financial products for over 150 years. To be eligible for the company’s equity release products, you need:

• To be at least 55 years of age.
• To be applying to release equity from your primary residence.
• To borrow less than £1mn (the maximum drops to £515,000 in Wales and Scotland).
• To not be living in a Grade I or II listed property.
• To be applying for a minimum of £10,000 against your property.

The company offers various types of equity release products, consisting of one lifetime mortgage and two retirement mortgages.

• Lifetime mortgage: Borrow lump sum with interest roll-up until the end of the scheme.
• Retirement Interest-Only Mortgage: Borrow a lump sum, but pay off the interest each month. This is an excellent option if you have a monthly income surplus.
• Retirement Capital & Interest Mortgage: Receive a lump sum, but pay off the interest and part of the borrowed amount each month. This is the best option if you plan to leave some inheritance to your loved ones.

Note that for the last two equity release options, Nationwide only allows applicants to borrow up to £500,000, or 50% of their property value.

Legal & General

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British financial services and asset management firm Legal & General has been operating since 1836. Here’s an overview of the company’s fantastic equity release products:

• Applicants must be at least 55 years old. If it’s a joint application, both applicants need to be over 55, and the company takes into account the youngest of the two when calculating the loan amount.
• Your property must be worth at least £70,000 (£100,000 for flats and apartments).
• You must borrow a minimum of £10,000.
• The home must be your primary residence, and you must be mortgage-free or have very little left to pay.

The company’s equity release products are divided into lifetime mortgage and home reversion:

• Home Reversion Scheme: Through this option, you can sell all or part of your home but remain living there as a tenant until you pass away or go into full-time care.
• Lifetime mortgage: Borrow a lump sum, with various repayment options available, including interest-only and lump sum.

Legal & General is a fantastic option if you require a wide variety of equity release products, especially since it offers home reversion schemes.

Canada Life

Canadian life insurance company which has operated in the UK for years. In addition to retirement and life insurance products, the company also offers equity release services. To be eligible, you must:

• Be at least 55 years old (also applies for joint applications).
• Be a UK resident and owner of the property.
• Choose your primary or second residence (if you’re opting for your second residence, it must be available for you to use).
• Ensure that your second residence is only let out for a maximum of four weeks per year.

Canada Life offers two types of equity release products – Lifetime mortgages and Buy-to-let mortgages.

• Lifetime mortgages: Standard lifetime mortgage with multiple repayment options, including capital repayment and interest roll-up.
• Later Life Buy-to-let mortgage: This option allows you to access the equity you have built up in your buy-to-let property if you are over 55 years old. This is a unique solution offered by Canada Life.

Canada Life is a fantastic option if you’re looking to release equity from a second property, a solution that many lenders don’t offer.

Halifax

British bank Halifax, founded in 1853, has been a popular mortgage provider in the UK due to its low rates and accessibility. It also offers a selection of equity release products. To be eligible, you must:

• Be over 55 years of age (that includes anyone that’s part of a joint application).
• Be using your primary residence.
• Have a property worth a certain amount and plan to borrow a minimum amount. You can get the exact figures by getting in contact with the company.

The company’s equity release products include:

• Lifetime mortgage: Standard equity release scheme with repayment when you pass away or go into full-time care.
• Retirement Interest Only: Borrow a lump sum, but start paying off the interest from the get-go.
• Home Reversion Plan: Sell all or part of your home while retaining the right to live there until your death.

Key Equity Release

Compared with the company’s mentioned on this list, Key equity release is relatively new, having been founded in 1998. The company’s products and services are aimed at later life customers, including equity release, wills, and estate planning. To be eligible for equity release, you must:

• Be over 55 years of age.
• Be planning to release at least £10,000.
• Have a property with a value of at least £70,000.

The company’s equity release products are solely lifetime mortgages, with the option of drawdown or lump sum payment. In addition to this, the company offers all new customers a luxury hamper for the Christmas season in 2021. This offer is valid between 1st November and 13th December 2021.

Pure Retirement Equity Release

Pure Retirement is a British company with a focus on later life insurance and financial products. To qualify for the company’s equity release products, you must:

• Be over 60 years of age.
• Be the owner and resident of the property you plan to use.

The company offers lifetime mortgages, with a range of repayment options available.

Pure Retirement doesn’t disclose the minimum property value and borrowing amount, so you should get in contact with an advisor to get an exact figure. Also, you should note that Pure Retirement charges a series of fees during the application process, including valuation and advice fees.

Responsible Lending Equity Release

Responsible Lending is a UK company specialising in equity release products. The firm is partnered with Credit Suisse. To opt to borrow money through the company, you must:

• Be over 55 years old.
• Be a resident in the UK.
• Have equity in your property.
• Meet a minimum property value and borrowing amount to be eligible.

The company offers standard lifetime mortgage products, with the option of a lump sum payment or a drawdown scheme, where you can access money in short bursts over time. The company is one of the best due to its sole focus on lifetime mortgages and its emphasis on integrity and transparency with customers.

That’s one of the critical elements to getting a suitable equity release deal since a lack of transparency can sometimes lead to equity release horror stories.

Retirement Bridge Equity Release

Retirement Bridge is another British company focusing on retirement mortgages. The firm manages over 4,5000 plans and is a full member of the Equity Release Council in the UK. You can opt for an equity release scheme if you:

• Are over 60 years old and under 90.
• Have a property with a minimum value of £100,000.
• Plan to release a minimum of 25% of your property value.
• The process could involve fees, which the company will notify you of at the application point.

Unlike the other companies on this list, Retirement Bridge solely provides home reversion schemes. There are three plans in total – No Rent, Fixed Rent, and Escalating Rent.

• No Rent: This is a standard home reversion plan where you sell between 25% and 100% of your property for a cash lump sum. In return, you retain the right to live at the property until you pass away.
• Fixed Rent: Like the No Rent option, you receive a lump sum after selling all or part of your home. However, you then pay a fixed monthly rental cost to the company. That option enables you to borrow more.
• Escalating Rent: The option is the same as Fixed Rent, but instead, there’s a 2.5% annual compound over the rental total.

Note that failure to meet rent payments could result in you losing the right to live in the property.

Equity Release Companies Overview

Here’s an overview of the equity release companies featured on this list:

Where information is not available you should contact the lender directly to get an exact figure on how much you can borrow and the minimum release amount

How much can you release from your property?

Lenders will take into account your age and property value before deciding on how much you can borrow. For example:

• A 55-year-old with no mortgage and a property valued at £300,000 can release £78,000 at 3.73%. The same applicant could release up to £88,500 at 6.60%, and a minimum of £33,650 at 2.93%.

It’s important that you work out exactly how much you need from the equity release scheme. You don’t want to expose yourself to high-interest rates when in reality, you don’t need a higher volume of funds.

What are the benefits of equity release?

There are no restrictions on how to use your funds. Therefore, the benefits of equity release are endless. Many people use it as a way to help cover retirement costs, help a loved one onto the property ladder, or help pay medical bills.

Don’t opt for the first deal you’re offered; make sure to shop around and get multiple quotes. There could be better rates out there.

What you should consider

There are plenty of equity release horror stories that highlight the importance of doing your due diligence before deciding on a plan. You can check our comprehensive overview of equity release horror stories to see the most common mistakes and pitfalls.

Before considering this type of mortgage, you should check with a professional advisor whether better solutions on the market can give you access to cash at more favourable rates. Also, ensure that the company you plan to use is reputable and fully accredited by the Equity Release Council.