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What is Equity Release Lump Sum?

Equity release lump sum plans allow homeowners to unlock the value of their property by taking a single, large cash payment. This type of equity release is ideal for those who need a substantial amount of money upfront, for example, to fund home improvements, pay off debts, or support retirement plans. Equity release products are regulated by the Financial Conduct Authority (FCA), ensuring consumer protection and oversight.

Key Features and Benefits

  • Large Upfront Payment: Receive a significant lump sum payment from your property’s value.
  • No Need to Move: Continue living in your home while accessing its value.
  • Fixed or Variable Interest Rates: Choose between fixed or variable interest rates based on your financial planning needs.
  • No Negative Equity Guarantee: Thanks to the standards set by the Equity Release Council (ERC), you will never owe more than the value of your home.
  • Lifetime Mortgage: The most common type of lump sum equity release plan, where the loan plus interest is repaid when you die or move into long-term care.

Factors to Consider

Eligibility

Equity release lump sum plans are typically available to homeowners aged 55 and over with a qualifying property. The amount you can release depends on factors like your age and the value of your home. Make sure your property meets the lender's criteria, which often include the type and location of the property.

Costs

Understanding the costs associated with equity release lump sum plans is crucial. These can include interest rates, arrangement fees, valuation fees, and legal costs. The interest on the amount you release is added to the loan and can grow over time, especially with compound interest. Compare different plans to ensure you understand all the costs involved.

Impact on Inheritance

Releasing equity from your home will reduce the value of your estate, which means you might leave less to your loved ones. Some plans allow you to protect a portion of your property’s value to pass on as an inheritance. Discuss the impact on your estate with your family to ensure everyone understands the implications.

Impact on State Benefits

Taking out a lump sum equity release plan can affect your eligibility for means-tested state benefits. The additional income or savings may reduce the benefits you receive. It’s crucial to discuss this with an adviser to fully understand the implications.

Advice

Seeking professional advice is essential when considering a lump sum equity release plan. An adviser can provide personalised recommendations based on your situation and goals. They can help you understand the pros and cons and find the best plan for you. Speaking to an adviser is crucial to ensure you are making an informed decision.

Next Steps

Choosing the right equity release lump sum plan can be complex, but getting expert advice can make it easier. By understanding your specific needs and circumstances, an adviser can help you find the best plan that provides access to your home’s equity.

Interested in the benefits of equity release lump sum plans? Speak to a knowledgeable adviser who can guide you through the process and help you make the right choice.

Get Expert Equity Release Lump Sum Plan Advice Now

Frequently Asked Questions

The amount you can get depends on your age, the value of your home, and the type of lump sum equity release plan you choose. Generally, older homeowners can release more equity. An adviser can help you determine the maximum amount available to you.

Why Use Us?

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How It Works

  1. Complete our simple form
  2. Our partner, Unbiased, will connect you with one equity release adviser perfectly suited to meet your needs. Expect an email with their details.
  3. You'll receive a no-obligation equity release quote
  4. Your assigned broker will then contact you to schedule your first meeting.

What People Say

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*Example rate shown is from Hodge with a rate of 6.05% (12/09/2023). The rates shown are for illustrative purposes only, they should not be taken as any form of advice or recommendation. Actual mortgage quotes are based on individual circumstances.

  1. THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

IF YOU ARE THINKING OF CONSOLIDATING EXISTING BORROWING YOU SHOULD BE AWARE THAT YOU MAY BE EXTENDING THE TERMS OF THE DEBT AND INCREASING THE TOTAL AMOUNT YOU REPAY.