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Am I eligible?
There are many reasons why people choose equity release. Here are some of the most common uses:
Equity release is a way to access some of the tax-free funds from the value of your home. It can help you take control of your later life finances.
Watch our video to find out more about Key's equity release and see if it could be an option for you.
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Transcript
When it comes to equity release, we all have questions.
What, for instance, is it exactly?
Equity release is a way for homeowners over 55, whose property is worth at least £70,000, to release tax-free cash from their homes.
And will we still own our home?
Yes – and with Key’s plans you can stay in it for as long as you like.
Will we have to make monthly repayments?
No, not unless you want to. The loan, plus rolled-up interest, will be paid back when your plan comes to an end.
Could our family inherit the debt?
No – all of Key's plans come with a ‘no negative equity’ guarantee, so you’ll never owe more than your home is worth and there’ll never be a debt for your family to take on.
How much can we release?
This depends on your age, how much your house is worth and your general health. Find out how much you could release with our free calculator.
What do people usually use the money for?
Key customers spend the tax-free cash on many different things, such as repaying existing debts, travel, and home improvements.
So, what’s different about Key?
Because Key takes a personal and honest approach to equity release, it's good to know we can answer all your questions in a way that's right for you. By ordering our free expert guide, using our free online calculator, or by calling us.
Key - for the life in later life.
What, for instance, is it exactly?
Equity release is a way for homeowners over 55, whose property is worth at least £70,000, to release tax-free cash from their homes.
And will we still own our home?
Yes – and with Key’s plans you can stay in it for as long as you like.
Will we have to make monthly repayments?
No, not unless you want to. The loan, plus rolled-up interest, will be paid back when your plan comes to an end.
Could our family inherit the debt?
No – all of Key's plans come with a ‘no negative equity’ guarantee, so you’ll never owe more than your home is worth and there’ll never be a debt for your family to take on.
How much can we release?
This depends on your age, how much your house is worth and your general health. Find out how much you could release with our free calculator.
What do people usually use the money for?
Key customers spend the tax-free cash on many different things, such as repaying existing debts, travel, and home improvements.
So, what’s different about Key?
Because Key takes a personal and honest approach to equity release, it's good to know we can answer all your questions in a way that's right for you. By ordering our free expert guide, using our free online calculator, or by calling us.
Key - for the life in later life.
Equity release is available to UK homeowners aged 55 or over. There are four types of equity release available with Key in the UK and they work in different ways.
With Key's range of lifetime mortgages, you could access the funds you need now and still own your home. There are usually no monthly repayments to make. The loan, plus compound interest, is usually repaid through the sale of your property. This is generally when the last remaining applicant on the deeds passes away or moves into long-term care.
You can only release equity through a qualified adviser who'll make sure:
- You only borrow what you need
- You understand how the product works
- It's right for you - if it's not we'll tell you
You have two options when it comes to releasing your funds with a Key lifetime mortgage.
- With a lump sum lifetime mortgage where you release tax-free funds from your home as a single amount.
- With a drawdown lifetime mortgage where you release your tax-free money in smaller amounts after an initial lump sum.
Watch our video to learn more about the benefits and drawbacks of equity release and see if it could be right for you.
Our equity release advice relates to Key's range of lifetime mortgages only - loans secured against your home.
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Transcript
What are the benefits and drawbacks of equity release?
Like any financial product, equity release has potential benefits and drawbacks to weigh up.
Benefits
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Tax-free cash: You can unlock cash from your home, tax-free, to help meet your needs in later life
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Stay in your home: You'll retain full ownership of your home and can stay in it for as long as you wish
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Reduced or no monthly repayments: You can make reduced or no monthly repayments with a lifetime mortgage. This applies to a payment-term lifetime mortgage after the oldest applicant turns 66, and overpayments can be made at any time, subject to criteria
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No negative equity guarantee: You'll never owe more than your home's worth or pass on any equity release related debt to your family, provided terms and conditions are met
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A payment-term lifetime mortgage: Could allow you to unlock more of your home's value at a lower interest rate than a comparable lifetime mortgage
Drawbacks
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The interest can build up quickly: Lifetime mortgages and payment-term lifetime mortgages are loans secured against your home and are subject to compound interest, meaning the amount you owe can grow quickly
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Reduced value of estate: Equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits
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Long term financial product: These are long-term financial products and are not designed to be repaid early. If you do, early repayment charges may apply
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Reduced or no property equity: Equity release may leave you with limited or no property equity remaining and will reduce your financial options in the future
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Mandatory payments: There's a period of mandatory payments with a payment-term lifetime mortgage, and your home may be repossessed if you don't keep up with these payments
We only recommend equity release if it's right for you
You have to receive qualified advice before taking out equity release, so you can be sure it's the right decision for you
All our equity release advice relates to Key lifetime mortgages and payment-term lifetime mortgages only - loans secured against your home.
Our fixed advice fee of £1,299 is only payable on completion. Equity release will reduce your estate's value and may affect your entitlement to means-tested benefits.
A lifetime mortgage or payment-term lifetime mortgage may result in limited or no property equity remaining and will reduce your financial options in the future.
Key is a specialist, award-winning later life mortgage provider for the over 55s. We've helped over a million customers see if equity release was right for them. After we take the time to understand your needs, we'll recommend the right later life option for you.
Customer stories
Things to consider
- All our equity release advice relates to Key lifetime mortgages only - a loan secured against your home
- The loan, plus compound interest, is typically repaid through the sale of the property when the last remaining applicant passes away or moves into long-term care
- Our fixed advice fee of £1,299 is only payable on completion
Your other options with Key
If another product is more suitable, we'll refer you to a different adviser within Key Group to help. If you go ahead, you'll only be charged the same £1,299 advice fee you'd pay with us, even if their fee is usually higher. Key offers alternatives to equity release such as a retirement interest-only mortgage or retirement repayment mortgage.
Other options to think about
It's important to know your other options before going ahead with equity release. These include: downsizing, unsecured lending, using existing assets, or support from friends or family.
We know that you may still have some burning questions too. So, here are the answers to the queries we get asked the most. Still can't find the information you’re looking for? We're only a phone call away.
Before deciding on equity release, consider factors such as the impact on your estate, the potential effect on means-tested benefits, interest rates and the long-term implications for your estate. Seeking advice from one of our equity release advisers can provide you with a comprehensive understanding of how it could help you reach your later life finance goals.
The cost of equity release depends on a few factors, like your plan and provider. There are four initial fees you may need to budget for (if applicable to your plan):
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Surveyor's valuation: Usually paid with the application
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Solicitor's fees: Usually paid when you receive your tax-free funds on completion
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Lender's application fee: Usually paid when your plan begins, and you receive your tax-free funds
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Our fixed advice fee: Our fixed advice fee of £1,299 is only payable on completion
Yes, you can move house if you have a lifetime mortgage. Most equity release plans are portable, meaning you can transfer them to a new property. However, the new property will need to meet the criteria set by the equity release provider. This may involve a revaluation and adjustments to your plan based on the new property's value and location.
If you are unable to port your lifetime mortgage to the new property it will need repaying when you move and may be subject to an early repayment charge.
Yes, with a lifetime mortgage, you will retain ownership of your home. You'll be able to live in it for the rest of your life or until you move into long-term care. The lender places a first legal charge on your property.
This is entirely different to a home reversion plan, as this involves selling all or part of your property. The home reversion company becomes the legal owner of the property and you become the beneficial owner.
In the case of a lifetime mortgage, if you pass away or move into long-term care, typically your home will be sold, and the proceeds will be used to repay the outstanding loan, including compound interest.
If there is any remaining equity, this will go to your estate if you pass away. If you move into long term care, you will receive the remaining funds after repayment of the lifetime mortgage.
With a home reversion plan, the provider will receive their share of the proceeds when the property is sold, and you or your estate will receive any remainder.
Choosing the right plan involves careful consideration and expert advice. Our specialist equity release advisers will talk you through all of your available options based on your needs and circumstances. They will help you understand the potential impact on your finances, inheritance, and other aspects, ensuring you make an informed decision.
Page last updated: Monday 12 August 2024