How Long Does Equity Release Take?

How long does equity release take

This page was last updated on 1 October 2021

How Long Does Equity Release Take In October 2021? 

Equity release: What is it?

Equity release is a way that over 55’s can release money that is currently held up by their property. Two primary categories of equity release exist on the market :

  • Equity release via a lifetime mortgage
  • Equity release via home reversion schemes

Topics that you will find covered on this page

You can listen to an audio recording of this page below.

 

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A lifetime mortgage is generally the more popular choice of equity release plan for those in later life. However, if you are seriously considering equity release we strongly advise you seek professional legal advice before you sign any agreements. 

When you are hunting for equity release advice, always ensure the company is authorised, and regulated, by the financial conduct authority, especially if you are paying for your advice. 

Keep reading below to discover more about equity release products, and to find out the answer to the most common question of all: ‘how long does equity release take?’

What are the different equity release schemes available?

The two main equity release schemes available are home reversion schemes, or a product called a lifetime mortgage.

Lifetime mortgages are types of loans that are protected against your home. Essentially, a lender loans you money and when you die the sale of your home pays back the total loan amount plus any interest charged. 

There are many types of lifetime mortgage available, for example you could choose a drawdown lifetime mortgage, a lump sum lifetime mortgage, or a lifetime mortgage whereby you make monthly repayments on the interest accumulating. 

With a home reversion scheme, you sell the house you own, or just a percentage of it, at an amount below its market value. Back in return you get either a lump sum or regular income, normally monthly. You therefore get to remain living in your home but as a tenant, however you pay no rent!

We recommend speaking to an equity release adviser before deciding what type to go for. 

Here is a useful video about equity release.

How Long Does The Equity Release Process Take?

The equity release process can be broken down in to the following areas.

1 – The Equity Release Application Process

To apply you must first fill out an equity release application form. You must also seek financial advice regarding equity release and your personal circumstances. Without financial advice no provider of equity will accept an application. 

You often need to pay fees at this point during your equity release application process. At this first step you typically pay the application fee, valuation fee, and fees for equity release advice

Your lender and solicitor will also need to see documentation, such as proof of identity. 

2 – A local surveyor determines what your home is worth

To determine how much equity you can release your provider will ask a surveyor to determine the market value of your home.  

They will then let your solicitor know what they deem your home to be worth. This allows your provider to calculate the amount of tax free cash they wish to give you; you can discuss both the valuation and offer with your solicitor. 

Try our free equity release calculator and see how much you could borrow in 30 seconds

3 – Title checks are undertaken

This part of the process requires your solicitor to contact HM Land Registry and get a copy of your title deeds. They must do this to get all the details of your home, including existing mortgages and secured loans that you might have against your property. 

Provided this part all goes smoothly, there should be few delays here. However, sometimes the finer details of deeds need amending. This is where delays might arise. 

4 – A completion date is set 

The compilation date is the day you will receive the money, the exact amount being agreed prior based on details such as your home’s value. 

You will be given your money via bank transfer or by cheque, should you prefer this. 

You can also choose whether you want to get your funds as a lump sum amount, or as a regular payment. 

5 – Can you be refused equity release?

The simple answer to this is that Yes you can.   When you go through the application process the lenders will look at your request and could conclude that you are refuced equity release.

 

"The average application takes around 8 weeks for completion. However, some people do get completion sooner whilst others might have to wait a little longer for completion, for example if your lender spots any mistakes in your application. "

How does a property valuation work?

This is fairly straightforward – a surveyor comes to your home and estimates your property value. They do this by comparing your home with other properties in the area and how much those nearby homes have sold for recently. 

The surveyor will also consider if repairs or renovations might be needed in your home in the near future. Then they can report back to the equity provider, who will use this to calculate how much equity you are able to access. 

The equity release process? 

The average application takes around 8 weeks for completion. However, some people do get completion sooner whilst others might have to wait a little longer for completion, for example if your lender spots any mistakes in your application. 

If you want to speed up the equity release process it is even more necessary to seek independent legal advice. A professional advisor can help check for mistakes on your application form, for example. Ultimately, they bring your completion date forward. 

equity release process

What things might delay my application?

It is not uncommon for the process of releasing equity to get delayed, as it is a complicated and high-risk financial product. It is important that equity-release is done with caution, and you allow time for contract checks, for example.

Often, when equity release is delayed it is for a common reason. So, if you are aware of these from the start you can take steps to avoid delays in your equity release application. 

Common reasons why people experience delays in releasing equity are as follows:

  • Their property is unregistered
  • Their property is, on paper, possessed by someone who is now deceased
  • Their original property valuation was a significant overestimate, and hence a second valuation is needed (down valuation)
  • Their property is currently being held in trust
  • Restrictions such as county court judgements are being held on the title deeds

If you think any of these problems might apply to you make sure you discuss your concerns with your equity release solicitor. Both the homeowner and the lender need to be represented by a solicitor, according to the equity release council, to avoid conflicts of interest arising.

equity release timeline

How can I speed up my application?

Firstly, always let your advisor know if you have a strict deadline you need to work towards at the first meeting. Then they can tell you if your deadline is realistic, or not, and tell you what can be done to help you meet your deadline.

To help speed things along we recommend being as flexible as you can when it comes to meetings with your solicitor, lender, and property valuation. That way, your equity release mortgage wont be delayed simply because you are on a waiting list for third party meetings. 

What is the catch with equity release?

Equity release is a legal, but high-risk financial product. It allows you to access money tied up in your property, however you have to repay this money, plus interest, when you die.

Many people find that equity release is a great help, for example it can help people pay for long term care whilst they continue living in their home. Other people use the cash to help out their loved ones, or simply for a nice treat like a new car or holiday. 

During the process both the lender and borrower are represented by their own solicitor, helping to make things as transparent and safe as possible. You should also be sure that the firm you choose to go with is authorised and regulated by the financial conduct authority (FCA). 

If you would like to release equity from your home, then you must take legal advice. Legal advice is a requirement so you cannot get lifetime mortgages or a home reversion plan without it. This is to protect the financial consumer. 

To protect yourself, you should always choose an equity release provider that is a member of the equity release council. Any provider with a membership abides by a no negative equity guarantee. 

Essentially, what this means is that even if the value of your property falls, you will never owe more than what you initially borrowed from your equity release provider! Your solicitor is best positioned to go through all of the  legal and financial specificities with you. 

Who is eligible for an equity release loan?

To take out an equity release plan from an equity release provider you must be a homeowner, over a certain age. The youngest homeowner that can take out a home reversion plan or lifetime mortgage is one aged 55.

How big a cash lump sum can I get?

If you know the rough value of your property you could use an equity release calculator to estimate how much money you could potentially release. Almost every equity release calculator is free to use. Remember, though, this is just an estimate. 

An equity release calculator is also a useful tool  if you want to receive an income in regular, smaller amounts. 

A financial adviser can take a more detailed look at your personal circumstances and give you a more reliable figure, as well as tailored advice. 

Can I be refused equity release?

Yes, it is possible to be refused equity release. This is because there are key criteria that need to be met, in order to make your application suitable and appealing to a potential lender. 

How long does it take to remortgage and release equity?

This is a slightly different way of releasing funds, without having to go to a specific equity release lender or be of a certain age. 

When you still have an outstanding mortgage, the percentage of the home that you own is known as equity. When remortgaging, you release some of this equity so that you can use the money. 

This means you technically own less of the property by changing mortgages, but can enable you to pay for things such as home improvements, long term care for a loved one, or a nice holiday. 

Once you have applied for a remortgage applications take 4 to 8 weeks to go through. If you want to remortgage quickly, make sure your solicitor and all other parties are aware of your deadline. 

Can I sell my house if I have equity release?

Yes, most types of equity release do let you move your plan to your new mortgage should you choose to sell your property and get a new house and mortgage. 

Your lender will have to approve the new mortgage, though. If your new mortgage is much lower, depending on how much, you could incur early repayment charges.  

Therefore, we recommend speaking to an equity release advisor beforehand, especially if you think you might want to sell up in the future. They can help you weigh up the risks of an early repayment charge.

See how much money you could be entitled to using the equity release calculator below

 

Want to find the best equity release deal or speak to a specialist to have your questions answered?

You can contact Key Equity Release, our partners, in one of 3 ways.   

  • Option 1 – Call directly on – 0333 567 1607
  • Option 2 – Book an appointment directly in the calendar below, and one of the Key team will call you back at your chosen time to discuss your requirements
  • Option 3 – Leave your contact details below and we will get in touch with you.

 

Option 1 – Call directly

Mon – Thurs – 9am – 8 pm

Friday – 9am – 5:30pm

Saturday – 9am – 5pm

Option 2 – Book an appointment, in the calendar below, for an equity release specialist to call you back when its convenient

Option 3 – Leave us your details and we will get in touch

Leave your contact details below and one of the equity release team will give you a call to discuss your needs.

Please note that all calls are undertaken by Key Equity Release, the UK’s leading equity release specialists. Key Equity Release is a trading name of Key Retirement Solutions Limited which is authorised and regulated by the Financial Conduct Authority

Article author

James Lloyd

I am the primary writer and author for Help and Advice, having originally helped start the site because I recognised that there was a need for easy to read, free and comprehensive information on the web. I have been able to use my background in finance to produce a number of articles for the site.

Outside of work I am a keen rugby player and used to play up to a semi-professional level before the years of injury finally took their toll.  Now you are more likely to see me in the clubhouse enjoying the game.

Email – james@helpandadvice.co.uk

Linked in – Connect with me

Frequently Asked Questions

What are the different equity release schemes available?

The two main equity release schemes available are home reversion schemes, or a product called a lifetime mortgage.

Lifetime mortgages are types of loans that are protected against your home. Essentially, a lender loans you money and when you die the sale of your home pays back the total loan amount plus any interest charged.

How does a property valuation work?

This is fairly straightforward – a surveyor comes to your home and estimates your property value. They do this by comparing your home with other properties in the area and how much those nearby homes have sold for recently. 

How long will the application take in total? 

The average application takes around 8 weeks for completion. However, some people do get completion sooner whilst others might have to wait a little longer for completion, for example if your lender spots any mistakes in your application.

What things might delay my application?

It is not uncommon for the process of releasing equity to get delayed, as it is a complicated and high-risk financial product. It is important that equity-release is done with caution, and you allow time for contract checks, for example.

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