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Equity Release in London - Lifetime Mortgages - Over 55s

Lifetime Mortgages, Home Reversion, and General Equity Release Advice in Central London, Greater London, and the Home Counties

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Equity Release in London

First and foremost, it’s important to know that equity release in London is highly recommended for people looking for extra cash. Equity release is a way to access a huge amount of money from your property in the city.

Property in London, particularly central London, has been increasing in value in recent years, meaning you may have bought your home when it was lower value, and watched the homes around you sell for a significantly higher amount.

This means you could benefit from the higher value of your home by taking out equity release now.

Another reason that equity release in London is a great idea is that there are many financial advisers available to you, so you can trust that you will be able to speak to someone who is knowledgeable about the different equity release plans, and who is experienced in helping people find the right one for them.

All advisors we refer you to are Independent Financial Advisors (IFAs), meaning they can advise you on lenders across the market, such as Scottish Widows, Legal & General, Aviva, Liverpool Victoria (LV), Canada Life, more2life, Hodge, Just Retirement, Pure Retirement, One Family and LiveMore Mortgages. All lenders are backed by the Financial Services Compensation Scheme.

Advisors are also members of the Financial Services Register and are regulated by the Financial Ombudsman Service and Financial Conduct Authority.

We are able to offer help across London in Bromley, Croydon, Enfield, Barnet, Ealing, Hillingdon, Lewisham, Hounslow, Barking and Dagenham, Bexley, Brent, Camden, City of Westminster, Greenwich, Hackney, Hammersmith and Fulham, Haringey, Harrow, Havering, Islington, Kensington and Chelsea, Kingston upon Thames, Lambeth, Merton, Newham, Redbridge, Richmond upon Thames, Southwark, Sutton, Tower Hamlets, Waltham Forest and Wandsworth.

What is the Equity Release Advice Process?

Firstly, you should look for a specialist or a firm that is a member of the Equity Release Council (ERC), as they will be approved by the official council, meaning you will receive high-quality advice for your money.

It also means they will be experts on equity release, so they can answer any burning questions you have, even if they are very specific and personal to your situation.

It also means you will have guidance and independent advice throughout the whole process of equity release, which is important as it can be tricky to navigate on your own.

Next, ensure the consultant or firm is regulated by the Financial Conduct Authority. This will come in handy if you need to make a complaint further down the line, as there will be a formal process for complaints that you can follow, meaning your voice will be heard.

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Another benefit of this is that your money will be protected as the firm must handle the equity release process in an ethical way.

Once you have confirmed that your chosen adviser is a member of the ERC and regulated by the FCA, it’s time to meet with them and explain your situation in as much detail as possible.

They are likely to ask you about your homeowner status, the value of your property, and your age, as these are all factors that contribute to your eligibility for equity release.

There are other important things you might cover in this consultation, such as your income, your credit rating, the location of your house, and your payment preferences e.g., would you prefer to pay in regular instalments or all at once? Would you prefer a plan that allows you to repay interest early or one that does not require this?

Most consultants will present a personalised illustration that helps you understand the features and risks of equity release so that you can make an informed decision on whether to release funds or opt for an alternative solution to earning additional money.

If you are concerned about missing out on this, ask for a personalised illustration, and most advisers will be happy to comply. The illustration should be based on your individual circumstances so you can see how equity could affect you personally.

If you have specific requests for your equity release plan, make this known to the adviser so that they are in the best position to find a fitting equity release scheme for you.

For example, if you are hoping to spend the money on a second home, mention this as there are tailored second home plans available.

Another example is if you are particularly worried about inheritance, as some plans allow for an inheritance protection guarantee and others do not.

Be prepared that you may have to pay an advice fee, so include this in your costs of equity release.

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Who Can Take Part In Later Life Lending & Is it Advisable?

If you want to take out a lifetime mortgage, you need to be aged over 55 years old and you must be a homeowner in the UK with a property of over £70,000.

Different schemes require different criteria, so sometimes you will need to be earning over a certain income, have a good credit rating, and be living in a certain location, but your adviser will inform you of the requirements of each plan before you select one.

For a home reversion, you must be 65 years old or over, and again, you should own your own home in the UK.

You must also be prepared to renounce your status as the sole owner of the property, as the equity release provider will take some of your home when you sign off on the scheme.

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Types of Equity Release in London

There are two main kinds of equity release in London – lifetime mortgages and home reversion. Under the umbrella of lifetime mortgages, there are a wide range of plans that benefit different people.

As well as these two principal schemes, we also have retirement mortgages and retirement interest-only options.

Lifetime Mortgages

With this style of mortgage, you borrow a sum of money from a provider that will only need to be paid back when your property is sold, either when you die or go into long-term care.

As there are so many types, each arrangement will work very differently.

Some involve fixed interest rates whereas others are variable, some allow you to repay some of the interest and some don’t, and some have more severe borrowing limits than others.

The general rules are:

  • You are expected to stay on this scheme for the rest of your life, and leaving early could mean facing early repayment penalties
  • You can borrow up to 60% of the house price
  • You remain the owner of your property
  • You must stay in your London property for the rest of your life
  • You can be paid in part payments or in full (as a lump sum)

One significant advantage of this type of equity release is that you can still be the owner of your property, which is reassuring if you want to pass on some inheritance to your beneficiaries.

You also only have to be aged 55, so this plan is more accessible to people at the beginning of their retirement (or who have not yet retired).

On the other hand, if your provider is not an ERC member, you may not have a any negative equity guarantee.

This means that if your house sale does not cover the costs of the loan and interest, your family may be required to pay the rest off.

Furthermore, this plan may affect your entitlement to means-tested benefits, so if you are currently claiming, it’s worth considering which option would provide more financial stability.

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Types of Lifetime Mortgage

There are many varieties that you have access to in London, so here is a list of the main arrangements.

Please click on each one to learn more about them in detail from our specialised pages:

Some of these are more popular than others, so you are more likely to have heard of a drawdown lifetime mortgage or a lump sum plan, but if you are left baffled by any of these schemes, don’t hesitate to go to each page to learn more.

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Home Reversion Plan

With this arrangement, you agree to give a share of your property to a provider, and the provider trusts that this share will increase over time and provide them with money. In return, you receive a lump sum of tax-free cash to spend on whatever you would like.

Again, the loan only has to be paid off when you pass away or move into long-term care. At this point, the proceeds of the sale will go to the provider as well as any beneficiaries you have decided to leave some money to.

The advantage of this arrangement is that the money you receive is not taxed, so you have access to a large sum of money very quickly, which is helpful if you are struggling.

Also, reversion schemes allow you to protect part of your home for your loved ones, so releasing equity in your home does not have to result in zero inheritance.

However, your home will no longer belong to you if you do this, and if the provider’s share increases drastically, you will not benefit from this. What’s more, as mentioned above, any state benefits you receive could be affected by this plan.

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How Much Interest Will I Be Paying With an Equity Release Mortgage?

We cannot tell you exactly how much interest you would be paying with an equity release mortgage in London as this is dependent on your mortgage provider, the scheme that you are with, and other factors.

If you are looking to pay low interest, it is advisable to find a plan that lets you withdraw small amounts, when necessary, rather than receiving a lump sum, so avoid lump sum plans. You may want to opt for one of the home reversion plans, as they provide you with interest-free cash.

There are also personal factors that can help you to access lower rates of interest.

For example, the enhanced/ill-health plan takes into account any disabilities or health problems you may have and offers you benefits such as low-interest rates if you are eligible.

If you want to pay your interest back early, try an interest-only plan that allows you to pay off some or all of the interest on a monthly basis.

Something else to keep in mind is that many equity release schemes charge compound interest, which means interest is charged on the total sum of the loan.

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Other Ways to Release Equity in London

As you have seen, taking out an equity release in London can be done in various ways, and two further ways you can do this is by taking out a retirement mortgage or a retirement interest-only mortgage.

These work in a similar way to the previously mentioned plans, but they are ideal for people who want their loan to begin just before or during their retirement.

With the interest-only option, you simply pay some of the interest back each month. This makes for a comfortable retirement as you don’t have to worry about your income.

Alternatives to London Equity Release: Downsizing in Retirement

If the idea of accessing money that is tied up in your property doesn’t appeal to you, you may decide to downsize to a new property instead. This involves moving to a smaller house to reduce the amount you are paying on your mortgage and perhaps reduce the cost of bills.

You will not have to take out a loan, but it may be hard to find a home that suits you given the soaring costs of property at the moment.

Furthermore, some pensioners prefer to resolve their poor financial situation without having to move, as they worry about the impact of a stressful move on their health.

We have written a more in-depth guide to the alternatives to equity release here.

If you are seeking equity release as a tool to combat the cost of living or repay an existing mortgage, then it might be better to seek out debt counselling and budget management advice. We’ve written a guide on this topic here.  Some organisations you can reach out to include the Society of Later Life Advisers, National Debtline, Money Advice Trust and Turn2us.

Advisors are trained by organisations such as the Financial Vulnerability Taskforce (FVT) to spot the signs of financial difficulty and to advise their clients accordingly.

Some organisations you can reach out to locally in London include:

1. Age UK London

Telephone: 020 7485 9245

Address: 247 Kentish Town Rd, London NW5 2JT


2. Citizens’ Advice Bureau

Telephone: 0800 144 8848

Address:3rd Floor, North, Head Office, 200 Aldersgate St, London EC1A 4HD


3. Money Advice Trust

Telephone: 020 7489 7796

Address: 21 Garlick Hill, London EC4V 2AU


How Much Can I Release From My Property?

The amount you can release from your home depends on the value of your home, your age, and the type of home you own i.e. a flat or a house.

The more valuable your home, the higher the loan will tend to be, as this is more desirable for equity release providers.

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What Can I Use My Loan For?

Once you get your hands on an equity release loan in London, there is no obligation for you to spend it on a specific thing.

If you are looking for ideas, one of the most common options is to spend it on something that puts you in a better financial situation i.e. paying off other debts or bills.

Some people decide to take out a lump sum to spend on renovating their house to make it easier to live in as they age (home improvements), or on the family holiday of a lifetime so that they can spend quality time with their loved ones after years of working hard.

Others decide to gift their money to a family member, so they may choose to pay towards a deposit on a house for their children or grandchildren to help them get on the property ladder.

Alternatively, they may want to help with things like tuition fees for their grandchildren or debts for their children.

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Will I Remain a Homeowner Under an Equity Release Scheme in London?

With a lifetime mortgage, you will remain the property owner. However, with a home reversion equity release scheme in London, you will not be the owner of your property as you will have sold a share of it to the provider.

Use Our Equity Release Calculator to Predict Your Equity Loan

We have an excellent tool to help you figure out the amount of money you could be releasing from your London property. Use our equity release calculator now to get a realistic idea of how safe equity release in London could benefit you.

When you use this tool, keep in mind that it is not completely accurate, so do not be disheartened if the value is lower than you anticipated. You may be able to get a better deal with a specific equity release lender in London.

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We Can Answer Your Questions About Equity Release in London: Get in Touch

The quickest and easiest way to become an expert in equity release in London is to learn from one of our qualified equity release experts, so call us today on 0330 058 1579 to do exactly that. Some people don’t want to make the first call, and we understand that, so you could also request that we contact you first.

Our impartial advisers are fully qualified and aware of the individual circumstances that can affect equity release, so they are the best people to present all your concerns to.

They will not push you into any hasty decisions, but they will instead encourage you to reflect on whether equity release is the right option for you and your loved ones by offering the advice you need.

For example, if you have an existing mortgage, you may be wary about taking out another one as you are already subject to certain conditions. However, it is possible to transfer your mortgage and use the equity release to pay off your current one.

In terms of providers, we work with many different clients across London, so we are experienced in what you should and shouldn’t look for. We will point you in the direction of a trusted lender if you decide that equity release in London is a viable and exciting option for you.

Finally, if you have found yourself here yet do not live in London, we are more than happy to help.

If you are considering equity release, whether you live in London or another area of the UK, we will happily explain the different later-life lending options and provide a quote regarding the amount you could borrow that is secured against your home.

Don’t wait around before seeking our advice. Many consumers in the UK are already benefitting from the money that was once locked into their property, and you could too.

Contact us as soon as possible about equity release products and decide if this is right for you.

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