How Much Does a Solicitor Charge for Equity Release?

Equity release is a great option for anyone who wants access to more money, but does not want to sell their house or downsize for whatever reason.

Whilst you are able to gain access to a significant amount of cash by opting for equity release, there are a number of costs associated with applying for equity release.

This leaves lots of people wondering ‘How much does a solicitor charge for equity release?’

Some of these costs include the cost of a solicitor, which could end up costing approximately £1,000, including VAT [1].

You can read a guide on paying solicitors’ fees on the Law Society’s official website. You can also find information on the Solicitors’ Regulation Authority’s website.

Whilst this is the average cost of a solicitor when it comes to equity release, this cost varies significantly depending on which law firm you opt to go with and how complex your application is.

If you want more information on ‘how much does a solicitor charge for equity release’ then continue reading.

How much does a solicitor charge for equity release – What is equity release?

Before we discuss the ins and outs of an equity release solicitor, it is important to gain a good understanding on what equity release actually is and how it works.

Equity release is a method of borrowing money, only available to those aged 55 or over who have paid off the majority of their mortgage.

You can gain access to your money in a few different ways. You can opt for a lump sum plan, which allows you the chance to spend your money all at once.

Alternatively, you can choose to take out a drawdown plan, which means that you will receive a set amount of money each month until you pass away or move into a care home.

All equity you receive is tax-free but will be charged interest. This interest will quickly turn into compound interest.

This is because all equity release loans continue until after you pass away. This means that year on year, the interest on your equity release loan will grow.

Most equity release lenders allow individuals the opportunity to pay off some of their loan whilst they live, in order to reduce the amount of compound interest and to reduce the overall loan amount.

The equity release loan is repaid from the sale of your property after you pass away or move into a care home.

Homeowners are given the chance to pay off their equity release loan early, but this will involve charges. If you decide that equity release is for you, then you will have to choose between a lifetime mortgage and a home reversion plan.

With lifetime mortgages, you will remain the sole owner of your property. If you opt for a home reversion plan then you will have to sell some of your property to the lender.

Whatever you decide to do, you won’t ever be asked to move out of your home.

Why do I need to receive financial advice first?

It is important to remember that releasing equity from your home is a huge financial decision that should not be taken lightly.

Your decision will not only affect you for the years to come, but it will also affect your family and next of kin, too.

Due to this, we highly recommend that you take financial advice before opting for equity release.

Your equity release adviser and solicitor should be able to help you make the right decision for you and for your family and will be able to highlight any future costs or complications associated with your equity release loan and application [2].

They will also be able to recommend any other options that they think you might be suited for, such as taking out a regular loan, downsizing or selling assets.

If you want more information on ‘how much does a solicitor charge for equity release’ then start the process today by calling us on 0330 058 1579.

Why should I hire a solicitor when it comes to equity release?

If you’re wondering ‘How much does a solicitor charge for equity release?’ then you need to understand the importance of engaging a solicitor.

As previously discussed, it is incredibly important to seek financial advice before you apply for equity release. However, it is also incredibly important to also seek legal advice before applying for an equity release loan.

There are a number of equity release advisers who are not fully trained and who might not be acting in your best interests. Engaging with an equity release adviser helps you to avoid making a mistake like this [2].

The biggest role your solicitor has is to safeguard you, meaning that they should always be acting in your best interest.

Your solicitor will always be the one to move money across when the time comes, just as they would do with any other exchange when it comes to buying or selling a house.

When you release the money from your home, it will likely be a significant amount of cash, which is why it is incredibly important to hire someone who is fully trained in equity release to handle your loan application and release.

What is the Equity Release Council?

If you are questioning ‘how much does a solicitor charge for equity release’ then it is important to understand what the Equity Release Council is and why they are important.

The Equity Release Council is responsible for ensuring that all lenders, advisers and solicitors who work within the equity release industry are legitimate and fair.

Whilst not everyone has to be a member of the Equity Release Council, by doing so you will be increasing your legitimacy and trust within the industry.

In fact, the Equity Release Council has created their very own list of recommended Equity Release Council-approved rules and recommendations for advisers, solicitors and lenders.

If you want more information on ‘how much does a solicitor charge for equity release’ then start the process today by calling us on 0330 058 1579.

Do you have to have a solicitor for equity release?

If you are questioning ‘how much does a solicitor charge for equity release’ then it is important to understand that engaging a solicitor is mandatory.

Whilst not every lender and adviser has to be a member of the Equity Release Council, the Equity Release Council have now made it mandatory to receive help from a fully trained solicitor before submitting their equity release application.

Therefore, if you want to apply for either a home reversion plan or a lifetime mortgage, then you will need to engage and pay for a solicitor to act on your behalf.

They will take over any communication you have with your lender and will also be responsible for releasing the money and funds to you on the day, whether you opt for a lump sum plan or a drawdown plan.

If you are wondering ‘how much does a solicitor charge for equity release’ then continue reading for more information on exactly what a solicitor does and how much they usually charge for their work.

How much does a solicitor charge for equity release?

There are a number of fees associated with equity release, including solicitor fees. Typically, these solicitor fees can cost anything between £600 and £1,500.

You might want to appoint a solicitor who you have previously worked with, in an attempt to get some form of discount for repeat business.

There are also a number of other fees you will have to pay when you opt for equity release. For example, you will have to pay for an application fee, which could end up costing you a few thousand pounds.

You will also have to pay for someone to come and value your house, so that the lender gains a clear picture on how much your property is currently worth.

You must also remember that when it comes to lifetime mortgages, you will have to pay interest on your loan.

These interest rates will remain fixed for the duration of your lifetime mortgage equity release loan, but they will grow into compound interest due to the nature of your loan.

As you can see, there are a number of fees associated with equity release, including solicitor fees.

Whilst these initial costs might seem expensive, you will be gaining access to a significant amount of cash in return for these initial investments.

If you are still wondering ‘‘how much does a solicitor charge for equity release’ then you should talk to a member of the team at the Equity Release Warehouse for more of a breakdown and explanation.

How much does a solicitor charge for equity release – When would I have to pay these fees?

Most solicitors allow you to pay your solicitor fees after you receive your equity release loan.

This is great for most people, as a lot of people who opt for equity release are struggling for cash in the first place, so would struggle to pay these fees upfront.

However, it is worth noting that some lenders might need you to pay these fees upfront, in particular the survey fees.

As this is usually only approximately £100, most people are able to pay this upfront before receiving any of their equity release loan.

If you want more information on ‘how much does a solicitor charge for equity release’ then start the process today by calling us on 0330 058 1579.

How do I choose the right equity release solicitor for me?

It can sometimes be hard to choose the right solicitor for you. Most people complain that their solicitor isn’t working hard enough, but it is important to remember that they are working to a deadline and are also working for a number of other clients.

If you have hired a solicitor in the past who worked well for you, then you should always choose to go with them again. You should hand your solicitor details over to your adviser, who will also inform the lender of your plans.

There are a number of things that you should look out for when choosing an equity release solicitor.

For example, your solicitor should be used to submit equity release applications and their law firm should be big enough to handle multiple applications at any given time.

If you want more information on ‘how much does a solicitor charge for equity release’ then start the process today by calling us on 0330 058 1579.

How much does a solicitor charge for equity release – The process

Whilst we have touched on what a solicitor will do during your equity release, below is a list of the process your equity release solicitors will take during your equity release application and loan [3].

1. Open your case

The very first thing your equity release solicitor will do is open your case. This means that they will start to work on your case and you will be given your very own reference number.

2. Checking your properties deeds

The second thing your equity release solicitor will do is to check your property’s title deeds, to ensure that all is in order. They will want details about your property and will also want to know if you still have an outstanding mortgage.

3. Creating your offer

Next, your equity release solicitor will inform you when your offer has been officially submitted. At this stage, your solicitor will want to make sure that you are happy with the ins and outs of your application and are sent a copy.

4. Checking your identity

Next, your solicitor will need you to confirm your identity, with some form of ID. Usually, you will need to send them a copy of your passport or driver’s licence, and they will also perform their own identity checks on their side.

5. Requisitions

Your solicitor will also want to ask your lender if they have any other questions, in order to ensure that your application is not delayed at any point. They will also make sure that you are made aware of any potential questions or issues that they might have so that you are kept in the loop at every point.

6. Completion

Finally, your equity release solicitor will complete your equity release loan. This means that they will let you know exactly when you are getting access to your cash. Usually, this could be a few days or even a few weeks but shouldn’t take too long.

When should I contact an equity release solicitor?

Now that we’ve answered ‘How much does a solicitor charge for equity release?’ it’s time to think about when you should contact and engage an equity release solicitor.

You should contact an equity release solicitor before your property has been valued. This is so that your solicitor is involved from the outset and so that they can gain a head start on your equity release application.

Essentially, the earlier you can engage an equity release solicitor the better for everyone involved. Once you have agreed on a solicitor, you should ensure that their contact details are passed on to both your equity release adviser and your lender.

How much does a solicitor charge for equity release – Talk to Equity Release Warehouse

If you are considering equity release but are worried about engaging a solicitor, then talk to a member of our team at Equity Release Warehouse.

We are able to provide you with all of the necessary information, but will never force you to make a decision if you are not ready to.

If you want more information on ‘how much does a solicitor charge for equity release, then start the process today by calling us on 0330 058 1579 or by visiting us online by searching www.equityreleasewarehouse.com.

References

[1] https://www.gov.uk/guidance/solicitors-guideline-hourly-rates

[2] https://www.fca.org.uk/publications/multi-firm-reviews/equity-release-sales-and-advice-process-key-findings

[3] https://www.lawsociety.org.uk/en/public/for-public-visitors/using-a-solicitor/paying-for-a-solicitor