Equity Release Calculator

Equity release allows homeowners aged 55 and over to take cash from their property without selling it. The dominant form, accounting for more than 99% of the market on Equity Release Council figures, is the lifetime mortgage: you borrow against the home, and the loan plus rolled-up interest is repaid when you die or move into long-term care. The alternative, home reversion, is rare and works differently, since you sell part of the home to a provider at below market price and keep the right to live there. Home reversion starts at age 65. How much you can borrow depends on your age, health and property value, typically about 25-30% of the home's value at 55, rising to 50% or more in your 80s. The calculator uses the midpoint of typical ranges for each age as an indicative maximum.

Interest on a lifetime mortgage compounds because no monthly payments are made. At a rate of 7%, a £100,000 loan doubles to £200,000 in just over 10 years, and the curve steepens from there. In September 2026 lifetime mortgage rates run roughly 6.3% to 8%, fixed for life, so £100,000 released at 7% grows into a debt of about £275,900 after 15 years, £387,000 after 20 and £542,700 after 25. Some plans allow voluntary payments of 5-10% of the capital a year without penalty, which holds the balance down for anyone who can afford to make them.

All plans regulated through the Equity Release Council include a no-negative-equity guarantee, meaning you or your estate will never owe more than the property's sale value. The guarantee has been part of the industry standards since 1991, when the Safe Home Income Plans (SHIP) code introduced it, and SHIP became the Equity Release Council in 2012; transparent fees and the right to move home sit alongside it. On the Council's figures, lending totalled £2.57 billion in 2025, up 11% from £2.3 billion in 2024 but well below the £6.2 billion peak of 2022, and the average amount released in the last quarter of 2025 was about £123,000. This calculator projects the loan balance at different time horizons, so entering your age, property value, any existing mortgage, the amount you wish to release and a house price growth assumption returns the projected debt and the remaining equity, which never falls below £0 because of the guarantee.

Cheaper routes exist, and for many people one of them is the better answer. Downsizing typically frees £80-£150k tax-free and lowers running costs, at the price of emotional and logistical disruption. A family loan can beat market rates but complicates relationships. A retirement interest-only mortgage holds the debt at its original amount by charging monthly interest, though you need enough income to qualify. A drawdown lifetime mortgage releases money as you need it and charges interest only on what has been drawn, which makes it cheaper than a single lump sum. Selling and renting works where cash flow is tight, at the cost of long-term housing security.

Money released counts as capital for means-tested support, which catches people out. It affects Council Tax Reduction, Pension Credit and council-funded care, where the local authority means test in England sets an upper capital limit of £23,250, above which you pay the full cost of your care, and the loss can run to thousands of pounds a year. The effect on inheritance is larger still. Releasing £100k at 7% leaves a debt of about £387k after 20 years, which is £387k less passing to children. Some plans offer inheritance protection, guaranteeing a minimum percentage of the property value to the estate in exchange for a higher interest rate. Families take the news better before the paperwork is signed than after.

Advice from an FCA-regulated equity release adviser is mandatory, and it costs £1,500-£3,000. Solicitor fees add £900-£1,800, application or setup fees £500-£1,500, and the valuation is either included or £200-£500 on top. Some plans ask health and lifestyle questions so they can offer an enhanced rate, and you can withdraw at any point before the plan completes. Sticking to Equity Release Council members brings the no-negative-equity guarantee, transparent fees and the right to move home, while unregulated providers are best left alone. The main lenders are Pure Retirement, Aviva, Just, Legal & General and More2life, and specialist brokers such as Age Partnership, Key Group and SunLife quote across the whole market.