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📅 Updated July 2025
Request Your Free Guide Below
Plan with confidence — learn how to compare downsizing with equity release in 2025.
See how much you could unlock.
Compare pros, cons & legal protections.
No jargon — just facts you can use.
🔐 100% secure. No spam. No pressure. Just helpful information.
📅 Updated July 2025
Equity Release With a Mortgage: Your Complete UK Guide
If you’re over 65 and still have a mortgage, equity release can feel complicated, but it doesn’t have to be. This guide explains how you can unlock tax-free cash from your home, even with an existing mortgage.
Learn how it works, who qualifies, and what to watch out for, all in plain English, tailored for UK homeowners like you.
Meet Bert Hofhuis — Your Trusted Retirement Guide
“I created this guide to help you cut through the noise — and make smarter decisions for a secure retirement.”
Meet Bert Hofhuis — Your Trusted Retirement Guide
Bert Hofhuis Is a Founder & Entrepreneur Simplifying the Complexities of Later Life Planning. He Navigates the Intricacies of Equity Release, Lifetime Mortgages, Reverse Mortgages, and Wealth Management With Clarity and Expertise.
20,000+ Readers Helped – Bert’s insights have guided thousands of UK homeowners toward more confident financial decisions.
Founder of BankingTimes – Trusted resource for equity release and SIPPs, tailored for over-55s in the UK.
Featured in Trusted UK Media – As seen in Yahoo Finance, iNews, University of Cambridge & more.
Bert Has Been Featured In:
How Equity Release With a Mortgage Works in 6 Simple Steps
Even if you still have a mortgage, you may be able to access equity from your home safely and legally. Here’s a simple breakdown of how equity release works when you’re over 65 and still repaying a mortgage.
Step 1: Speak to a Regulated Adviser
A specialist adviser will assess your situation, explain options, and confirm if it’s right for you.
Step 2: Professional Property Valuation
Your home is valued by a professional surveyor to determine how much equity you could release.
Step 3: Check & Clear Your Existing Mortgage
If you have an outstanding mortgage, it must be paid off first, usually using part of the equity release funds.
Step 4: Legal Advice & Application Process
You’ll get legal advice, sign documents, and the lender processes your application, fully regulated and transparent.
Step 5: Receive Your Tax-Free Funds
Once approved, your funds are released, either as a lump sum or drawdown facility, to use however you need.
Step 6: No Monthly Repayments Required
No monthly repayments. Loan and interest are repaid from your estate when you pass away or enter long-term care.
Equity Release and Mortgages Explained
Equity release lets you unlock tax-free cash from your home while still living there. It’s mainly used by homeowners aged 55 and over. If you still have a mortgage, part of the equity release must be used to clear that balance first, only then can you access the remaining funds.
Lifetime Mortgage
A loan secured against your home, repaid from your estate when you pass away or move into care. You remain the homeowner.
Home Reversion Plan
You sell a share of your home to a provider in return for tax-free cash, but remain living there rent-free until you move.
Mortgage Interaction
Any outstanding mortgage must be cleared at the point of equity release, often using part of the release itself.
FCA Regulation
Equity release in the UK is strictly regulated by the Financial Conduct Authority, ensuring consumer protection.
Who Can Get Equity Release With a Mortgage?
Not everyone qualifies for equity release, especially if you still have a mortgage. Here are the key requirements most UK lenders and advisers will check before you can proceed.
Eligibility Checklist
Age Requirement – You must be at least 55, though most borrowers are 65 or older.
Property Value – Your home should usually be worth £70,000 or more, and it must be your main residence.
Mortgage Balance – Any outstanding mortgage must be cleared at the point of release, often using part of the equity release funds.
Property Condition – The home should be in reasonable condition and of standard construction (some restrictions apply).
Location – The property must be in the UK.
Advice Requirement – You must receive professional, FCA-regulated advice before proceeding.
The Pros and Cons of Equity Release With a Mortgage
Equity release can be life-changing, but it isn’t right for everyone. Here’s a balanced look at the advantages and disadvantages, so you can make an informed decision with confidence.
Pros
Access Tax-Free Cash – Unlock money tied up in your home to spend on your needs.
Stay in Your Home – Continue living in your property without needing to downsize.
No Monthly Repayments – Most lifetime mortgages don’t require monthly repayments.
Clear Existing Mortgage – Release funds to pay off your remaining mortgage balance.
FCA Protection – Equity release is regulated, offering consumer protection.
Cons
Compounding Interest – Interest is added to the loan and grows over time.
Reduced Inheritance – Less value may be left to your beneficiaries.
Early Repayment Charges – If you repay early, fees may apply.
Affects Benefits – May impact means-tested benefits or future care funding.
Fewer Alternatives Later – Once chosen, reversing equity release is difficult.
Real Scenarios From UK Homeowners
Every situation is different, but here are a few common examples of how people in their 60s have used equity release alongside a mortgage. These stories are simplified to give you an idea, in the Masterclass, we’ll go into much more detail.
Clearing an Interest-Only Mortgage
A 67-year-old couple paid off their remaining mortgage using equity release, giving them lasting peace of mind in retirement.
Unlocking Cash for Renovations
A 70-year-old widow released funds to update her home, making it more suitable for later life, while staying mortgage-free.
Helping Family Financially
A 65-year-old father used equity release to support his children with house deposits, while still living in his own property.
What You’ll Discover in the Masterclass
Thinking about equity release with a mortgage? Our free Masterclass is for homeowners 65+ who want clear guidance before deciding. In just 30 minutes, you’ll learn the essentials in plain English.
How equity release really works when you still have a mortgage.
The most common pitfalls and how to avoid them.
Real-life examples from people just like you.
The key questions to ask before you take the next step.
If any of these sound like you, this guide will help you take the next step with confidence.
Expertise, Regulation, and Transparency
When it comes to equity release, trust matters. That’s why all of our content is reviewed by financial experts, based on FCA regulations, and written in plain English for homeowners like you.
FCA-Regulated Guidance
All advice is based on standards set by the Financial Conduct Authority.
Independent & Impartial
Our guides are unbiased and designed to help you make informed choices.
Reviewed by Experts
Content is fact-checked and approved by qualified financial specialists.
Clear & Simple Language
No jargon, just easy-to-follow explanations for UK homeowners.
Here Are the Answers to Common Questions
Still unsure if equity release is right for you? These are the questions we hear most often from people just like you — answered clearly, with no jargon or sales pressure.
Is the Guide Really Free?
Yes — 100% free, with no hidden costs or commitments. It’s our way of helping you make more informed financial decisions.
What Format Will I Receive the Guide In?
You’ll receive a downloadable PDF that’s easy to read on any device — phone, tablet, or computer.
How Do I Know the Information Is Up to Date?
Our guide is reviewed and updated regularly by our team — the current version is accurate as of 2025.
Does It Cover Downsizing and Alternatives?
Yes. The guide includes comparisons between equity release, downsizing, and other common retirement strategies.
Can I Share the Guide With a Family Member?
Absolutely. It’s written to help both you and your loved ones understand the full picture before making a decision.
Can I Print the Guide?
Yes — the guide is provided in a printer-friendly PDF format. You can print it at home or take it to a trusted adviser for review.
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📅 Updated July 2025