How much does equity release cost?

As with regular mortgages, there are some initial costs involved when you take out a lifetime mortgage. A lifetime mortgage is a loan secured on your home, so there is also ongoing interest on the loan.

• Arrangement fees
  An arrangement fee is sometimes known as an application fee. We charge around £600 or, for some products, there is no arrangement fee at all. There is also a fee of £30 to transfer your money to your solicitor on completion. These costs are not payable until your mortgage completes and the funds are released.
• Solicitors' fees
  If you're happy with your lifetime mortgage offer and want to go ahead and accept, you'll need to appoint an equity release specialist solicitor to act on your behalf. Equity release solicitor fees are around £860 but the average solicitor fees can vary, so it's worth comparing a few prices before you make your own decision.
• Lifetime mortgage interest rates
  The interest rates on our lifetime mortgages are fixed, meaning they won't change over time. The interest is the amount we charge on the money we lend you. Any unpaid interest is added to the loan each month. Interest is then charged on the loan, plus any interest already added. This is known as compound interest or roll-up interest. You don't have to pay this until you die or go into long-term care. For our Optional Payment Lifetime Mortgage, if you make monthly interest payments for the first 15 years, a reduced fixed interest rate will apply for the life of the lifetime mortgage. If you miss more than six monthly payments within the first 15 years, or choose to stop making payments, the rate will increase to a higher, fixed interest rate for the remainder of the lifetime mortgage.

The information above is based on what we charge for our lifetime mortgages. If you choose to use an independent adviser, these costs may differ.

Some mortgage advisers charge a fixed fee for advice. Others may charge an advice fee that's a percentage of the total loan amount. All lifetime mortgage advisers will also receive a payment from the product provider. As a result, many advisers receive both an advice fee and payment.

We do things differently:

We don't charge an advice fee for equity release

If you use our later life mortgage advice service, our advice costs are covered by a payment we receive from Legal & General Home Finance Limited (the mortgage provider). This payment is only received when the lifetime mortgage completes.

This is not a direct cost paid by you, but is included in the product charges and interest rate you pay if you decide to take out the product.

If you want to know more please call us on the number below and one of our Customer Service Agents will be happy to explain.

We don't charge a valuation fee

When you first buy a home, a survey must take place in order to get a mortgage. The same process applies to equity release. You'll usually have to pay surveyor fees as part of this process. However, while we'll arrange for an independent valuation to value your house, this is all part of our service and we don't charge a fee for this.

If you choose to release equity from your home, we want you to feel confident with your decision. That's why we're transparent with our fees. If you're interested in seeing how much you could release with equity release, why not take a look at our equity release calculator.

If you have any further questions about equity release, don't hesitate to contact us, or take a look at our pros and cons of equity release for more information. We also have information on downsizing your home as an option.

Finally, remember that there may be cheaper ways to borrow money.