Equity release is when you take cash out of your home without having to move. It's available as two main types. The first is a lifetime mortgage, which is a long-term loan secured against the value of your home. The second is a home reversion plan, where you sell all or part of your home to a provider for less than the market value in return for a tax-free cash lump sum or a regular income. You then continue living there rent free.
The kind of equity release we offer is a lifetime mortgage, which is the most common type. We don’t offer a home reversion plan.
How does a lifetime mortgage work?
It’s a long-term loan secured against the value of your home, which you can apply for any time after you turn 55. You’d borrow a cash lump sum, but there are no monthly payments. Instead, interest builds up for as long as you have the mortgage and is charged on the total amount borrowed and the interest already added. This quickly increases the amount you owe.
When you (and your partner, if you’ve taken it out jointly) pass away or need to go into long-term care, subject to our terms and conditions, the loan and any interest that’s built up is paid back – normally using money from selling your home.
You need to know that taking out any type of equity release means you will leave a lower inheritance amount behind to loved ones. It may also have a tax impact and affect whether you can still claim certain welfare benefits.
Our free guide has more details that will walk you through the benefits and risks of the lifetime mortgage products we offer.
That’s mostly up to you. But releasing equity is a huge decision and commitment, so we have to be happy you’re doing it for the right reasons when you apply for our lifetime mortgage. Like giving your (unintentionally) retro kitchen a much-needed refresh. Filling up your retirement tank to make yourself a little more comfortable. Or helping your kids with a leg up on the property ladder.
Learn about the ins, outs and in-betweens of our lifetime mortgage in our 3-minute video.
Watch the video about See how the equity release we offer works
Is equity release safe?
Yes. As an equity release provider, we’re regulated by the Financial Conduct Authority (FCA). We’re also a member of the Equity Release Council, and follow their standards and safeguards.
If you take out a lifetime mortgage with us, we also promise that you or your estate will never have to pay back more than your home can be sold for, as long as it's sold for the best price reasonably obtainable.
You can read our answers to other common equity release concerns. We know you might come across a lot of unfamiliar terms when you're looking into equity release, so we've pulled together an equity release glossary to help you understand it all better.
What are the pros and cons of our lifetime mortgage?
It’s important to look at everything before you apply for our lifetime mortgage – the great bits and the not-so good things.
Pros
You'll still own your home You're the full legal owner of the property – that doesn't change.
You won’t be leaving your family with the debt Because of our no negative equity guarantee, your loved ones will never have to repay more than the money received from the sale of your property, provided that it’s sold for the best price reasonably obtainable.
You can leave a little – or not so little – something behind With our optional inheritance guarantee you can set aside a percentage of your home’s value to leave for family – it just means you can borrow less (the minimum you can borrow is £15,000). Inheritance will still be reduced.
An interest rate just for you We tailor our interest rates to each application so it’ll be unique to your personal situation.
Take a little here and pay a little there if you need We let you choose to take a one-off lump sum or a smaller cash sum with a cash reserve to dip in to. You can also choose to make limited repayments during the term of the lifetime mortgage, if it suits you to do so, subject to our terms and conditions.
We only charge interest on money you’ve taken out If you set up a cash reserve, no interest will build up on money sitting there, until you withdraw it. We’ll set a new interest rate for each amount you take out, so your initial lump sum and any later withdrawals will have their own rate.
Our lifetime mortgage can move with you You can transfer your lifetime mortgage to a new home, as long as it’s a type of home we can lend on at the time.
Be protected if you downsize later Should you move to another property later which you can’t transfer your lifetime mortgage to, you may be able to pay it off in full with no early repayment charge, thanks to our downsizing protection. You must have had your lifetime mortgage for three years or more before you can use downsizing protection.
Cons
You’ll be paying back a lot in interest Interest is charged on the total amount borrowed and the interest already added, so the amount you owe goes up quickly.
Leaving less behind Even if you set aside a percentage of your home’s value for your loved ones, paying off the money you’ve released (plus any interest) will still mean you’re leaving them less in inheritance.
It may have a tax impact and affect certain benefits Taking cash out of your home through a lifetime mortgage could have tax implications or affect whether you’re eligible for certain welfare benefits. Your equity release adviser will go through all of this with you.
It’s a big decision, and a lifetime commitment Our equity release is designed to last for the rest of your life – or until you need long-term care. If things change and you want to pay this off sooner, there may be a big early repayment charge.
You’ll need to get legal advice There’ll be a cost for this, which you’ll need to pay yourself
How much money could you release from your home?
Get crunching the numbers with our calculator, for an idea of how much tax-free cash you could be able to release from the value of your home.
How long does equity release take – and how do I apply?
A straight-forward lifetime mortgage application with us should take around 8 to 10 weeks. That's from when you first apply to the money landing in your bank account. We’ve put together a stride-by-stride outline of how this could unfold, and you can read more about the application process here.
Expert equity release advice
A specialist equity release adviser can help you with determining whether equity release is the best way forward, or whether it may be best to consider other alternatives. As equity release could be a hefty commitment, influencing many areas of your financial future, you will need expert advice to help you with the heavy lifting so you can make the right decision.
If you decide to take out a lifetime mortgage with Aviva, we waive any advice fees, meaning there is no additional cost to you.
There are two main ways of releasing equity from your home.
One is a lifetime mortgage. Like the one we offer, this is a long-term loan secured against your home's value, which means you're still the owner. All the details we give here, including the answers to these questions, are about our lifetime mortgage.
The other is a home reversion plan. This isn’t so common, and involves selling all or part of your home. You then stay on as a tenant, but without paying rent.
Do I still own my own home?
Yes, everything will be much the same as it is now. It’s up to you to insure your home, and stay on top of council tax, energy and water bills. You’ll also need to keep the property in good shape. You’ll then stay there until you die or go into long-term care, subject to our terms and conditions.
Are there any fees?
Your equity release adviser will give you all the details about any fees you need to pay, when they share their plan of how your lifetime mortgage will work. This will be based on your situation, and will be different for everyone. We’ve included the types of fees you might expect to pay in our summary of how much equity release costs.
What happens when it’s time to sell the house?
In most cases, the sale of the house is when the lifetime mortgage is repaid.
Should you go into long-term care, it will be you or your solicitor who manages the sale. If you live in your home until you die, it’ll be sold by an executor looking after your estate if you have a will – or by administrators if you don’t have one.
Any money that’s left afterwards belongs to you or your estate.
Can I end the lifetime mortgage early?
You can end the lifetime mortgage at any time, by paying off the loan and any interest that’s been added. However, our lifetime mortgages are designed to last for the rest of your life, which means it might not be the right choice for you if you’re planning to pay it off early.
Like other mortgages, there’s likely to be a substantial early repayment charge to pay it off early. As part of the process of setting up a lifetime mortgage with us, you need to choose between fixed percentage or gilt index early repayment charges. We’ve got an online booklet explaining how each repayment type works.
We’re a member of the Equity Release Council, which promotes high standards and best practices for all customers who take out equity release. Aviva equity release is recognised by What Mortgage Awards as best equity release lender, and best equity release lender customer service. We're also recognised as best equity release lender by The Personal Finance Awards.
Why choose Aviva?
A highly rated choice We continue to receive recognition, both in our role as a lender and for the lifetime mortgage we offer.
Our heritage of helping We’ve been protecting people like you for over 325 years.
Tap into 25 years’ equity release expertise We've helped over 282,000 people release more than £11 billion.
Our no negative equity guarantee You'll never have to repay more than the money received from the sale of your property, provided that it is sold for the best price reasonably obtainable.
Still leave an inheritance With our optional inheritance guarantee you could lock away a percentage of your home's value to leave behind to your loved ones, although this will reduce the amount you’re able to borrow. Inheritance will still be reduced.
Get specialist equity release advice
Your call will be answered by our dedicated team who can provide you with information and answer any questions on Aviva’s lifetime mortgage. They can also book an appointment for you to speak to an Aviva equity release adviser who can provide you with financial advice, an illustration and submit an application if you choose to proceed. You don’t have to commit to anything, and you won’t need to pay an advice fee, instead we’ll make a commission payment to your adviser upon completion of your loan. If you need to borrow more at a later date, you will need to get financial advice again and an advice fee will apply, which will be payable upon completion of your loan to your adviser.
Call us free
Ring now to speak to our team.
0800 141 3493
Monday to Friday: 9:00am - 5:00pm
Weekends and Bank Holidays: Closed
Ask us to call you
Give us your name and number and our team will call you between Monday and Friday, 9.00am to 5.00pm.
* Your call will be answered by our dedicated team who can provide you with information on Aviva’s lifetime mortgage only. They’re authorised and regulated by the Financial Conduct Authority.
Calls to 0800 or 0808 numbers from UK landlines and mobiles are free. For our joint protection, calls may be recorded or monitored, and saved for a minimum of 5 years. Our opening hours may be different depending on which team you need to speak to.
.jpg)