How to Release Equity From Your Home

By Clare Townhill • Updated 29 November 2025
Disclaimer: Prices and ratings correct at time of writing.

Equity release is a way for homeowners aged 55 and over to unlock money from their property without having to sell up or move out. It can provide extra funds for retirement, whether to boost income, pay off debts, or offer financial help to family members. But it's also a serious long-term commitment, so understanding how it works, the risks, and the alternatives is vital before you decide to proceed.

How does equity release work?

Most people release equity using a lifetime mortgage. This is a loan secured against your home that is repaid, along with interest, when you die or move into long-term care. You continue to own your home and remain responsible for looking after it.

You can usually choose how to access the money:

• Lump sum: a one-off payment for big expenses such as home improvements.
• Drawdown: smaller amounts released when you need them, so you only pay interest on what you take.
• Combination: many plans let you take an initial lump sum and keep a reserve for later.

You can check out our equity release calculator:

What are the risks?

• Reduced inheritance: Because interest compounds, the longer you live, the more the debt grows, leaving less for your beneficiaries.
• Impact on benefits: A large lump sum could affect entitlement to means-tested benefits, such as Pension Credit or Council Tax Support.
• Early repayment charges: If you want to pay off your loan early or move to a property that doesn't meet lender criteria, you may face steep fees. Always check the fine details of any plan you are considering.
• Property market risk: If house prices fall, there may be less equity left in your home.

Alternatives to consider

Before choosing equity release, weigh up other options:

• Downsizing: Martin Lewis (Money Saving Expert) advises always considering selling and moving first, as this can free up money without interest charges.
• Family support: Gifts or loans from relatives can avoid the costs of compound interest.
• Grants or benefits: Check whether you qualify for local authority or government help.
• Other borrowing: A retirement-interest-only mortgage or a personal loan may suit some people better.

Equity Release Best Practices

• Use free guidance first: Services like Pension Wise through MoneyHelper offer general impartial information at no cost.
• Seek regulated advice (paid): If you proceed, you must get advice from an FCA-regulated adviser. This isn't free; advisers typically charge a fee, but this ensures that the plan and advice that they give you is tailored for your individual circumstances.
• Shop around: Different lenders and brokers offer different deals. Speaking to a broker or lender puts you under no obligation to go ahead.
• Check service quality: Read real customer reviews on Trustpilot, Google and Feefo to see how providers support their customers.
• Consider all costs: Don't just look at the interest rate. You need to factor in advice fees, arrangement fees, and any early repayment charges.
• Consider a broker: Brokers like Age Partnership compare equity release plans across the market (including Aviva, SunLife, and others) to help find the right option for you.

Conclusion

Releasing equity can unlock money in retirement, but it's not the right choice for everyone. It reduces the total value of your estate and can affect any benefits you receive, so it's vital to explore alternatives first and seek both free guidance and paid regulated advice. If you do go ahead, shopping around, ideally with the help of a broker, gives you the best chance of finding a plan that suits your needs and circumstances.