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Types of equity release

There are two main types of equity release schemes

The two main types of equity release schemes are...

Lifetime mortgage

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This lets you take out a loan against the value of the property. In most cases, these don’t usually require any repayments until the property is sold

Home Reversion Plan

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You can sell all or part of your property in exchange for a lease for life and a cash lump sum

Making the right choice

Choosing the most suitable scheme will depend on a number of considerations, including:

  • How much equity needs to be released
  • The value of the property
  • What the need is, for example a cash lump sum
  • The age of the homeowner
  • How much, if any, the homeowner wants to leave as an inheritance
  • Whether you're prepared to give up full ownership of their home

At LV= we only provide Lifetime Mortgages.

Our lifetime mortgage products

We know that your home is very important to you, that’s why our lifetime mortgages are clear and straightforward

Lifetime Mortgage - Lump Sum+

If you need to release equity for a specific expense such as home improvements or to pay university fees, it may be better to borrow a one off lump sum

Flexible Lifetime Mortgage

Specifically designed for people who wish to release some equity from their home now and expect to want to borrow more in the future

Comparing types of Lifetime Mortgage 

Lifetime Mortgage - Lump Sum + Flexible Lifetime Mortgage
Tax-free cash lump sum
yes
yes
Borrow from £10,000 upwards yes yes
Interest compounded annually (not monthly as in many other plans)
yes yes
Loan set aside for you to drawdown from as and when you choose to No
yes
Interest charged on money you release yes yes
Typically no monthly repayments
yes yes
Interest is repaid from the final sale proceeds of the property
yes yes
Retain full ownership of your home yes yes
‘No negative equity’ guarantee yes
yes
Plan can be transferred if you move house yes
yes
Able to release further funds in the future yes
yes
Lifetime Mortgage - Lump Sum + Flexible Lifetime Mortgage
Tax-free cash lump sum
yes
yes
Borrow from £10,000 upwards yes yes
Interest compounded annually (not monthly as in many other plans)
yes yes
Loan set aside for you to drawdown from as and when you choose to No
yes
Interest charged on money you release yes yes
Typically no monthly repayments
yes yes
Interest is repaid from the final sale proceeds of the property
yes yes
Retain full ownership of your home yes yes
‘No negative equity’ guarantee yes
yes
Plan can be transferred if you move house yes
yes
Able to release further funds in the future yes
yes

Alternatives to a lifetime mortgage

Whatever your particular reason for wanting extra cash, remember lifetime mortgages are not right for everyone, so before you go ahead it’s important to have considered the alternatives

Options could include:

  • Selling your home and buying a less expensive property. Although this may mean you moving to a different area or having a little less space, and paying the moving costs, your new home could be mortgage free
  • Using savings or other investments
  • Checking that you are claiming all the state benefits that you’re entitled to

Your equity release specialist will help you consider these and other alternatives

As members of the Equity Release Council we’re bound by their Statement of Principles, a group of safeguards and guarantees that give you confidence in the products we offer and the information you receive
Starting an ENQUIRY 

If you are an existing lifetime mortgage customer with us please call:

Mon to Fri 8:30am-6pm

For TextDirect: First dial 18001

We will record and/or monitor calls for training and audit purposes

 

To start an equity release enquiry, contact your independent financial adviser, or find one specialising in equity release through the Equity Release Council (ERC).