later life finance logo mortgages retirement and wealth

0800 2465119

How To Release Equity For Home Improvements

How much can I borrow?

Compare Lifetime Mortgages With Our Experts!

(Access broker exclusive deals & our best rate guarantee!)

£

Author Paul Murphy 

Later Life Finance Limited. 

How To Release Equity For Home Improvements

For homeowners over 55 equity release provides a flexible and safe solution for releasing equity for home improvements. 

Whether you’re planning general updating and redecoration, a full renovation, or improving your garden to enjoy the summer evenings, releasing equity to fund your home improvements provides a flexible solution. 

As a specialist later life mortgage broker, we help our clients raise money for a variety of reasons to remortgage and release equity:

  • Extensions
  • Home adaptations
  • Wetrooms
  • Stairlifts
  • Loft Conversions
  • Flat roof replacement
  • Garden Landscaping
 

Money released for home improvements can either be taken as a lump sum, or on a drawdown basis in order to stage the borrowing over time. Depending on your specific requirements and timescales, this form of plan provide a flexible solution to reduce the overall interest cost, as Interest accrues only on the amounts you’ve withdrawn. 

You can get started with our guide on how much you can borrow with a lifetime mortgage and book a free adviser review to compare the best deals available. There’s no obligation to proceed and it’s a great way to explore your options in confidence. If you decide to proceed your dedicated adviser will safely guide your application through to completion. 

How much can i borrow?

Can I Release Equity for An Extension?

Yes, you can release equity for a home extension. Equity release is a popular method of funding an extension as you have the option to make voluntary repayments on a lifetime mortgage with total control. 
 
Furthermore, the drawdown option provides access to additional funds if required in the future for added peace of mind and financial security. 

Ready to compare deals with your expert adviser?

calculate my equity

Access broker exclusive deals

Lock in the best rates

Access lender cash backs

Claim your FREE home valuation 

Book a no obligation FREE review today!

(Best Rate Guarantee)​

How Do I Choose The Best Company For My Home Improvement Plans?

Selecting the best equity release provider for your plans is depending on your personal requirements along with your current and longer-term priorities. 

For example, are you planning to downsize and repay the money borrowed, or use other assets to reduce the sum borrowed?

Lifetime Mortgages- Is A Lump Sum or Drawdown Plan Best For Home Improvements?

A popular form of borrowing is a Lifetime mortgage drawdown plan, which provides a more economical option for releasing equity from your home. 

These plans still involve a lump sum, but the idea is to release a smaller initial sum with access to the further borrowing as it’s needed. 

This makes more financial sense and provides greater certainty than leaving a larger lump sum in savings, as you’re unlikely to earn a better interest rate than the mortgage rate charged on the sum borrowed for a home equity loan.

Remortgage for Home Improvements Calculator

Book my free market review

How Much Equity Can I Release?

Book a free call back and compare all your options with an expert

Get calculations, projections and illustrations, stress free.
Calculate My Equity
Read our customer stories

Get your free lifetime mortgage calculation & book your free review...

£

Next Steps

To discuss the best equity release providers for home improvements, compare deals and access professional advice, contact Later Life Finance to book a free review of all your options. 

Lifetime mortgage FAQs

The amount you can release on a lifetime mortgage is usually between 20% and 50% of the home's valuation. This is based on the age of the youngest homeowner and the property type.
If you need to raise more money and have no remaining Drawdown (reserve) Facility, you may be able to take a Further Advance from your lifetime mortgage. This is additional borrowing on top of your existing lifetime mortgage and is subject to the valuation of your home and the balance on your lifetime mortgage.
Equity release companies who adhere to the Equity Release Council codes of conduct offer the option to transfer your lifetime mortgage to a new property if you decide to move. However, certain conditions must be met for the new property to be considered "suitable." A suitable property refers to one that is deemed marketable by the equity release company in the future. For instance, if the new property is located in a flood-prone area, the transfer of the lifetime mortgage may not be permitted. In the case of downsizing to a property of lesser value, you might be required to repay a portion of your lifetime mortgage to facilitate the transfer.
In the case of a lifetime mortgage, you generally do not need to make monthly repayments since the loan, along with the accumulated interest, is settled when your home is eventually sold. Your lifetime mortgage adviser will provide detailed projections of how much you will pay back based on whether you opt to make payments or not.
In the event of you passing away shortly after obtaining a lifetime mortgage, the interest accrued would not have significantly accumulated, resulting in a smaller growth of the debt. If no other homeowner is listed on the lifetime mortgage, the lender requires the mortgage to be settled within 12 months of you passing away. The executors of your will sell the property and utilise the proceeds to settle the debt. The beneficiaries of your estate may opt pay off the debt using cash or a new mortgage and retain ownership of the property. This will depend on factors including your wishes set out in your will, and on whether the property is to be retained or sold, with any remaining equity divided by your beneficiaries. 
Equity release lenders who are a member of the Equity Release Council provide a no-negative equity guarantee. This ensures you will never be required to repay more than the proceeds from the sale of your home to settle the debt. In other words, the lender cannot pursue you for any shortfall between the debt amount and the sale proceeds. This protection is made possible by the no negative equity guarantee, which is upheld by all members of the Equity Release Council. According to this guarantee, the lender is strictly limited to requesting only 100% of the sale proceeds as repayment. They are not permitted to seek additional payment from you, your estate, or your estate beneficiaries.
A typical rate for a lifetime mortgage typically falls between 5.9% and 7%. That said, your rate may be different depending on factors like your loan-to-value ratio and the features included in your plan. It’s important to compare the features of different plans to find the one that best fits your needs.
Lifetime mortgages come with a few risks, such as the possibility of owing more than the value of your home due to accumulated interest. They also require monthly fees and can significantly reduce the amount of inheritance you can pass on to family members. Ultimately, it’s important to consider all of these factors when deciding if a lifetime mortgage is the right choice for you.
Lifetime mortgage interest rates are typically based on your age, the amount of money you need to borrow, and the value of your property. Generally speaking, the older you are and the less you borrow, the lower the rate you can expect. Drawdown lifetime mortgages have interest rates set at the time of further borrowing, whereas the initial lump sum is determined at the time of arranging the plan. So be sure to research what’s out there before making a decision.
Yes, you can pay off a lifetime mortgage early, but there may be fees associated with doing so. Providers have varying levels of early repayment charges which your equity release adviser will discuss with you to ensure you have access to all your options and understand the features and charges. It is best to check with your provider before you decide on the repayment plan.
Lifetime mortgages come in several forms, including lump sum, drawdown and interest-only plans. Each offers different rates and repayment arrangements, so your adviser can tailor the mortgage to meet your needs. Later Life Finance provides access to the whole lifetime mortgage market. We will explain the features, costs and points to consider of each option. This will help you make a balanced decision on the right solution for you.
You can repay an interest-only mortgage with an equity release plan. Lifetime mortgages are the most popular form of equity release and allow optional repayments of interest charges, if you wish. Since monthly repayments are voluntary with a lifetime mortgage, your home is not at risk of repossession if you do not maintain monthly payments.Therefore these plans can be more suitable into retirement years.
An interest-only lifetime mortgage is a type of equity release plan where you can pay the interest off on a monthly basis. This avoids compound interest being added which stops the loan from increasing. This type of mortgage is popular for homeowners who want to maintain equity in the home for inheritance or downsizing purposes.
later life finance logo mortgages retirement and wealth

Head Office

  • 80 Pegholme, Wharfebank Mills, Ilkley Road, Otley, Yorkshire, LS21 3JP
  • 0800 246 5119
  • advice@later-life-finance.co.uk

Site Links

Later Life Finance Ltd is registered in England and Wales no. 09320116. Registered office, 7 Airport West, Lancaster Way, Yorkshire, Leeds, LS19 7ZA.

Authorised and regulated by the Financial Conduct Authority. Later Life Finance Ltd is entered on the Financial Services Register https://register.fca.org.uk/ under reference 959556.

If you wish to register a complaint, please write to advice@later-life-finance.co.uk or telephone 0800 2465228.

A summary of our internal complaints handling procedures for the reasonable and prompt handling of complaints is available on request and if you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service at www.financial-ombudsman.org.uk or by contacting them on 0800 0234 567.

© Copyright 2022. Later Life Finance Ltd. All rights reserved. Cookie Policy | Privacy Notice

Ⓒ 2022 - All Rights Are Reserved