Equity Release Companies
Knowing what the different providers offer is essential if you’re considering equity release. With a growing number of companies and plans available, finding the best equity release company for your needs can be challenging.
What do the different equity release companies offer?
The equity release market has expanded, with thousands of homeowners aged 55 and over choosing to unlock their property wealth.
As a result, many different providers offer a variety of plans.
This guide will walk you through what’s available and compare each company’s eligibility criteria, plan benefits, and potential drawbacks.
Things to keep in mind when choosing your equity release provider
Selecting the right equity release company and plan is crucial to achieving your financial goals. In 2023, equity release customers accessed an average of £97,878 in tax-free cash from their homes—equivalent to several years’ worth of income for a typical pensioner. Given the significant amounts involved, ensuring you get a deal that suits your needs is important.
Key factors to consider when choosing the best equity release company for your needs include:
- The provider’s eligibility requirements
- How much do they allow you to release
- The interest rates they offer for lifetime mortgages
- Any arrangement fees
- Additional features like enhanced terms or interest-only options
- Whether early repayment charges can be waived under certain conditions
- The ease of transferring the plan if you move to a new home
If your goal is to maximise the amount you can release, you may want to look for a provider offering enhanced terms based on health conditions like high blood pressure, diabetes, or smoking history.
Alternatively, if protecting a portion of your property’s value for your heirs is a priority, you’ll want to explore providers that offer Inheritance Protection Guarantees as part of their plans.
Standard features of top equity release companies
Choosing one of the UK’s best equity release providers gives you peace of mind, flexibility, and security. Here are some key features they share:
FCA Regulation
The Financial Conduct Authority (FCA) oversees the equity release market, ensuring that the best companies, brokers, and advisers operate under strict guidelines designed to protect consumers. Always work with an FCA-authorised broker or provider to ensure you’re safe.
Equity Release Council (ERC) Membership
The ERC sets industry standards to safeguard customers. Brokers and advisers who are members of the ERC commit to offering clear, complete information about the plans they recommend, including costs and what happens if you move.
They also ensure that the products they suggest are suited to your needs, even if that means advising against equity release in some cases.
Product Standards
Providers who are ERC members must adhere to specific consumer protection standards. These include:
- A ‘no negative equity’ guarantee, ensuring you or your estate never owe more than your property’s value.
- The right to remain in your home for life or until you move into long-term care.
- The option to move to another property, provided it meets the lender’s criteria.
- The ability to make voluntary, penalty-free repayments.
- Fixed or capped variable interest rates for lifetime mortgages.
Flexible Product Options
Equity release products have evolved in recent years, offering more choices to suit individual needs. Some providers allow you to opt for a one-off lump sum or access funds in smaller amounts over time through a drawdown plan. Interest-only plans can help manage overall costs.
Other innovative features offered by the best equity release companies include:
- Inheritance protection, allowing you to reserve part of your property’s value for your heirs.
- Waiving early repayment charges under certain conditions, such as moving after a specified period.
- Buy-to-let and second-home lifetime mortgages.
- Enhanced terms and lower interest rates for individuals with certain health conditions.
Equity release video
Watch the video below to see what MoneyNerd has to say about the best equity release companies:
Which equity release providers are members of the Equity Release Council?
The Equity Release Council (ERC) upholds industry standards to ensure consumer protection, and many well-known UK providers are members, offering a variety of tailored plans.
Aviva is a major player in the market, offering flexible lifetime mortgage plans, including options for both lump sum and drawdown, designed to help homeowners access funds in a way that suits their financial goals.
Canada Life provides a wide range of lifetime mortgage plans, including options that allow homeowners to release equity from second homes, making it a suitable choice for those with multiple properties.
Just offers the “Just for You” plan, which is known for its flexibility. Customers can personalise their lifetime mortgage with features like drawdown, inheritance protection, and varied interest payment plans to suit their individual needs.
Legal & General (L&G) offers two main lifetime mortgage products. These plans provide flexibility with cash drawdown options and optional interest payments, enabling customers to manage their equity release in line with their financial circumstances.
LiveMore Mortgages caters to older homeowners, offering equity release from age 55 with various payment plans to suit different income levels and property types. The provider focuses on delivering options that align with the unique needs of its customers.
LV= has been operating in the equity release space since 2002 and offers both lump sum and drawdown lifetime mortgages. Their plans are designed to provide financial flexibility in retirement.
More2life specialises in a broad range of lifetime mortgage products, offering features like inheritance protection and partial repayment options, giving customers more control over their equity release plans.
OneFamily Lifetime Mortgages Ltd is a newer provider in the equity release market. Their focus is on providing simple, flexible products designed to improve the quality of life for customers in retirement.
Pure Retirement offers five lifetime mortgage plans that include partial repayment options and cashback incentives, providing customers with flexibility and added value.
Scottish Widows offers lifetime mortgage plans with the option of an initial lump sum release, followed by the ability to draw down more funds later, along with other safeguards to protect consumers.
Standard Life Home Finance, through its Horizon plan, offers equity release for those over 55, with flexible features like partial repayments and future drawdown options, allowing customers to adjust their plans as their retirement needs evolve.
Each of these providers adheres to the standards set by the ERC, ensuring that their equity release products meet the highest levels of consumer protection and flexibility.
Can I go directly to an equity release company?
While it might seem easier to approach an equity release provider directly, most leading companies don’t offer advice directly to the public. Instead, they refer you to a broker or adviser specialising in equity release.
Remember that some advisers are tied to specific providers, meaning they may only recommend their linked provider’s products. This could limit your options and mean missing out on potentially better deals or features other companies offer.
By working with an independent equity release adviser with access to a range of providers, you can compare different plans and potentially save thousands of pounds in interest throughout your lifetime mortgage. It’s always worth shopping around to ensure you get the best equity release company.
Which banks offer equity release?
In the UK, only one banking group provides equity release: Lloyds Banking Group. However, you won’t be able to get an equity release directly through Lloyds Bank. Instead, Scottish Widows, part of the Lloyds Group, offers lifetime mortgages—the most common form of equity release.
Lloyds Banking Group also includes Halifax and Bank of Scotland, so customers from any of these banks who inquire about equity release are typically referred to Scottish Widows.
That said, it’s essential not to limit your search to Scottish Widows. Other equity release providers might offer more competitive terms, such as higher borrowing limits or lower interest rates, which could better fit your situation.
It’s also worth noting that Nationwide Building Society once offered equity release but now only serves existing customers who want to switch deals or borrow more. In addition to lifetime mortgages, Nationwide offers retirement interest-only (RIO) mortgages for their current clients.
Are there any equity release companies to avoid?
When considering equity release, it’s essential to choose a provider that is a member of the Equity Release Council (ERC).
The ERC enforces several essential safeguards to protect homeowners. For example, the “no negative equity” guarantee ensures you will never owe more than the value of your home, even if property prices fall.
Additionally, ERC members are required to give you the right to remain in your home for life or until you move into long-term care, as long as the property remains your primary residence. They also provide clear and transparent interest rates and allow for voluntary repayments to help manage the accruing interest.
By selecting a company with these protections, you can have greater confidence in the long-term stability of your plan.
Always consult a qualified financial adviser to ensure the provider meets your specific needs.
In conclusion
Choosing the right equity release provider and plan is an important decision that can significantly impact your financial future. With so many options available, it’s essential to carefully consider factors such as interest rates, product features, and any potential fees.
Consulting an independent adviser who can access a variety of providers is often the best way to ensure you find the plan that best meets your needs.
Whether you’re looking to unlock the maximum amount of equity or protect a portion of your property for your loved ones, exploring all your options can help you secure the best deal possible.
Find an adviser
Find a qualified and regulated equity release adviser using the Equity Release Council's register.
How much can you release?
You can usually release a minimum of £10,000, but the maximum amount varies based on several factors, such as your property's value and your age.
Typically, the older you are, the more you can release.
Are you looking for a quote?
While we do not provide a quote or call-back service as our website is purely informational, we understand that some people do want an equity release quote.
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