How much does equity release cost?

If you're thinking about using equity release to unlock cash from your home, you might be wondering how much it'll cost you. Royal London Equity Release Advisers explain the fees, charges, and interest rates so there aren't any surprises along the way.

Royal London has chosen to introduce its customers to the experts at Royal London Equity Release Advisers. They will provide advice on equity release products from across the whole market and will make a recommendation to you based on your personal circumstances. You will not receive advice or any recommendation from Royal London. The information on this page has been provided by Royal London Equity Release Advisers to help you understand more about releasing equity.

Fees and charges

Getting financial advice

Before you can get started with releasing equity from your home, you'll need to have a chat with an equity release adviser. They'll be able to talk you through the cost of equity release, the different equity release options, and any possible risks.

Adviser fees can vary, but with Royal London Equity Release Advisers it currently does not exceed £1,690. Their fee is only charged if you choose to proceed and release equity from your home.

Application fees

Otherwise known as an arrangement fee, some lenders will charge this to cover the cost of setting up your equity release plan. In some cases this can be paid when your application is completed and the funds are released.

Solicitors

If you’re releasing equity, you’ll need a solicitor to carry out all your legal work and make sure you have all the facts you need. Solicitor fees can vary, but they should let you know what these are up front. Usually, you’ll need to find and pay for a solicitor independently, so you can compare fees when you shop around.

Home valuation

Otherwise known as a survey, this is required from your lender to assess the value of your home. An independent surveyor is usually contracted by the lender to do a valuation, which you may need to pay for. Royal London Equity Release Advisers will let you know about this before you make a decision to proceed.

Other costs

Impact on your estate

Releasing equity will reduce the value of your estate. This can affect the value of any inheritance that you might want to leave behind.

Entitlement to benefits

Releasing a lump sum from your home may affect your entitlement to means-tested benefits.

Equity release interest rates

What will the interest rate be?

Equity release interest rates will vary depending on your own personal circumstances. Factors like your age, the amount that you want to release, and sometimes your health and lifestyle will be taken into consideration.

How does it work?

Lifetime mortgage interest rates are fixed for life, so you’ll have a guarantee that they’ll never change. You also don’t need to make any monthly repayments. The interest is rolled up and repaid, with the initial amount borrowed, at the end of the loan. This will happen when the last surviving homeowner dies or enters long-term care, and will usually be achieved with the sale of the home.

Making payments to a Lifetime Mortgage within your lifetime is completely optional, so you can choose the best route for your budget. Making payments could help you to manage the build-up of interest on your mortgage, reducing the amount owed in the future.

Although equity release involves a few fees and charges , unlocking cash from your home could allow you to be more flexible with your money. Knowing all the costs up front means you’ll be able to plan and budget before you commit.