ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Equity Release - release the money in your property

Updated on November 28, 2016

The interest-only mortgage timebomb

This article, although highlighting a number of areas where equity release (release cash from the value of your property) is generally used, it will primarily be used to highlight the huge 'ticking timebomb' that people with interest-only mortgages, coming to the end of the lending term, with a shortfall in their repayment vehicle (mainly endowments) ot nothing at all in place to pay the lender the amount due.

Equity Release (ER) is the answer for many people. Most lenders won't lend to people over a certain age - so a remortgage of a property to raise the amount needed to pay the original mortgage at the agreed date is not an option. Later Life Lending (equity release) is.

The modern ER plans are very flexible (compared to 10 years ago, say) and a number of prestigious lenders now offer them. They offer the facility to repay the amount released - or not, if you prefer. The language used has been simplified and, by being regulated by the Financial Conduct Authority (FCA) they have to be completely transparent and off gthe righht solution for each individual need.

Below I list some of the most common uses of ER - you'll see, because the main aim of this article is to offer guidance to those with soon-to-mature interest-only mortgages and nothing - or not enough - in place to repay their mortgage to the lender (it's estimated that more than 3m people have interest-only mortgages) I have put this use at the top of the list.

Common uses of Equity Release:

  • Repayment of an interest-only mortgage, where no repayment vehicle is in place.
  • A tax-free lump sum for a private private medical care, to avoid a lengthy waiting list.
  • Help a family member to buy their first home.
  • Help finance a move to a new property.
  • Replacement of family car/home improvements/similar uses.
  • Supplement retirement income.
  • Reduce the value of your estate and save on Inheritance Tax.
  • Enjoy your money while you're alive.
  • Actually go on that adventure that you've always dreamed of.
  • Purely to have the money to spend as you want, when you want.

When considering ER there are a number of things you really should consider, the first is ensuring that whoever is providing the advice is fully regulated by the FCA and that they are Whole of Market (WoM) advisrs, looking at the widest range of ER providers - if they are not WoM then you are not having all options explored for you. Some other qualities tyour adviser should have are:

  • Will they offer an initial meeting/discussion either by telephone or face to face without obligation and without charge?
  • They should, initially, explore whether equity release is a suitable route for you now or possibly later.
  • They should fully explain in full how equity release works and its impact on you & others.
  • They should look at and discuss all alternatives and provide access to these options if needed.
  • Their recommendation has to be based solely on your needs.
  • If, after they have fully explored your options, the recommended route is to proceed with an arrangement, then they should present you with with a Key Facts Illustration (a client specific illustration).
  • If you are fully happy to proceed, they should help you with the application process.
  • When an application is completed, they shpuld provide you with a suitability letter that will fully explain why the particular Equity Release product has been chosen for you.

Finding the right Equity Release adviser

Independent - or Whole of Market - advice is the key here. You want only to deal with experienced equity release advisers. Soe mortgage advisers will advice primarily on residential mortgages/remortgages with equity release as a 'sideline', something they don't specialise in but will provide advice on if a case lands on their desk. This isn't really good enough.

Equity release is a specialised form of lending and requires a mortgage adviser to have an extra (on top of his mortgage-related qualifications) qualification, that's why a great many mortgage advisers don't want to take their focus off their main profession - residential mortgages.

There are dedicated, Whole of Market, equity release advisers to be found - you want to do a little checking on them before committing to an adviser. Look at their qualifications, look for customer feedback (reviews), look at their website - is it professional looking (I know this isn't everything but it can certainly provide a feel for the firm), do they offer a professional free guide to Equity Release? Do they have an accurate - and easy-to-use calculator on their website.

These are a few of the factors you should consider before committing (trusting?) an adviser to act for you.

Tthe interest-only ticking timebomb

Interest-only mortgage ticking timebomb
Interest-only mortgage ticking timebomb | Source

The HubPages viewers opinion

We'd really like to know what your thoughts are on this, for many, stressful set of affairs. So many people, many of them moving into older age (over 55), with a mortgage that must be repaid to their lender and not enough (nothing at all in some cases) in place with which to repay the outstanding mortgage. Equity Release - freeing up cash from their home - is a more and more viable solution. So many people are equity-rich (the value of their home) and cash-poor.

The interest-only mortgage timebomb

Do you agree there is an interest-only mortgage timebomb?

See results
The Author - Frank Kelly
The Author - Frank Kelly


    0 of 8192 characters used
    Post Comment

    No comments yet.


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)