Overview

• Lifetime mortgages let homeowners over 55 borrow against their property without monthly repayments, with the loan and rolled-up interest typically repaid when the home is sold after death or a move into long-term care.
• Borrowing reduces the value of the estate for inheritance tax calculations, and gifts made from released funds can fall outside the estate if the giver survives seven years.
• Interest usually compounds over time and can significantly diminish what beneficiaries inherit, although some plans allow interest servicing or capped early repayments under Equity Release Council standards.
• Eligibility commonly requires a home worth at least £70,000, age thresholds of 55+ for lifetime mortgages and 65+ for home reversion plans, and potential impacts on means-tested benefits should be checked.
• Guides stress weighing equity release against alternatives such as regular gifts out of surplus income, annual exemptions, or trusts, with tailored financial and legal advice recommended before proceeding.