Equity Release Calculator
Equity release lets homeowners aged 55 and over unlock some of the value tied up in their home as tax-free cash, without having to move out or make monthly repayments. Our equity release calculator gives an illustrative estimate of how much you might be able to release, and shows how the loan balance grows over time under a typical roll-up interest structure.
Equity Release Calculator
Get an illustrative estimate of how much tax-free cash you could release from your home with a lifetime mortgage.
How a Lifetime Mortgage Works
The most common form of equity release in the UK is a lifetime mortgage — a loan secured against your home that does not require monthly repayments (though many modern plans allow optional interest or capital payments if you want to slow the balance growth). Instead, interest compounds (“rolls up”) onto the loan, and the full amount — original loan plus accumulated interest — is typically repaid when you die or move into long-term care, usually from the sale of the property.
Why Your Age Matters So Much
The maximum percentage of your property value you can release rises with age, because lenders base their offer partly on life expectancy — a shorter expected loan term for an older borrower means less time for interest to compound, so lenders can offer a higher percentage. A 55-year-old might access around 25% of their property value, while an 85-year-old could access 55% or more. This calculator uses an illustrative age-banded table to reflect this typical pattern across the market.
The No Negative Equity Guarantee
All lifetime mortgages from lenders who are members of the Equity Release Council — the industry’s standards body, which covers the large majority of the UK market — come with a no negative equity guarantee. This means you, or your estate, will never owe more than the property is worth when it is eventually sold, even if the loan balance has grown to exceed the property’s value due to compounding interest and flat or falling house prices. This protection is a standard, important safeguard to check for with any provider you consider.
What Roll-Up Interest Looks Like Over Time
Because interest compounds without monthly repayments, the loan balance can grow substantially over a long retirement. On a £100,000 release at a typical fixed lifetime rate, the balance could roughly double within 12–15 years if left entirely untouched — a genuinely significant reduction in the equity ultimately left in the estate. This is exactly why the calculator projects the balance forward over 5, 10 and your chosen number of years, so the long-term impact is visible upfront rather than only becoming apparent decades later.
Alternatives Worth Considering First
Equity release is a significant, largely irreversible financial decision, so it is worth exploring alternatives before committing. Downsizing to a smaller, cheaper property releases equity as a cash lump sum without taking on any debt or compounding interest, though it involves the practical upheaval of moving. Some homeowners find that a standard retirement interest-only mortgage, where you pay just the interest each month (rather than letting it roll up), offers a lower long-term cost if the monthly payment is affordable alongside retirement income. Family arrangements — such as a family member providing a loan or gift — are another route some households explore, ideally formalised properly to avoid future disputes. A regulated equity release adviser is required by law to discuss these alternatives with you as part of the advice process, precisely because the product is not always the right fit for every situation.
Frequently Asked Questions
Will equity release affect my benefits?
Potentially yes — releasing a lump sum or income can affect means-tested benefits such as Pension Credit or Council Tax Support, since it counts as capital. This is one of many reasons regulated financial advice is a mandatory part of the equity release process in the UK.
Can I still leave an inheritance?
Yes, though the amount is reduced by whatever is owed on the equity release plan when the property is eventually sold. Some plans offer an “inheritance protection” feature that ring-fences a guaranteed percentage of the property’s value for your beneficiaries, usually in exchange for a lower amount released initially.
Can I move house after taking out equity release?
Most modern lifetime mortgages are portable, meaning you can move the plan to a new property, subject to the lender’s criteria on the new property being suitable security for the loan.
Is equity release the same as downsizing?
No — downsizing means selling your home and buying a smaller, cheaper one, releasing equity as a lump sum without taking on debt. Equity release keeps you in your current home but creates a loan against it that grows over time.