If a large share of your wealth is tied up in your home, equity release lets you turn some of that value into cash without moving out or selling up. It is a question Moneysprite hears often from homeowners across London, where property values mean many people are sitting on far more wealth than their monthly income suggests.
Your two main options
Equity release covers two main products: lifetime mortgages and home reversion plans. With a lifetime mortgage, you borrow against your property while keeping full ownership. You are typically expected to be at least 55 years old, and the loan, plus any interest, is usually repaid from the sale of your home when you pass away or move into long-term care. Many lifetime mortgages let you make optional repayments to slow the interest building up, or choose a drawdown facility so you only borrow what you need, when you need it.
A home reversion plan works differently. You sell part or all of your home to a provider for a lump sum or regular income, while keeping the right to live there rent-free. Unlike a lifetime mortgage, where the debt grows over time, a home reversion plan fixes the share you're giving up from day one.
Why this matters more in London
London property values are among the highest in the UK, so a home here can represent a significant sum once released. That can be appealing if you want to help family onto the property ladder, fund home improvements, or boost retirement income.
Points worth thinking through
- Releasing equity reduces the value of your estate and any inheritance you leave behind
- Interest on a lifetime mortgage can grow substantially without repayments
- Money you release becomes cash in your bank account, and could count toward the savings limits that affect means-tested benefits like Pension Credit
- Many plans include a no-negative-equity guarantee, so your estate never owes more than the property is worth
None of this makes equity release right or wrong. For some London homeowners, it is a sensible way to unlock money otherwise locked in bricks and mortar. For others, downsizing or a mortgage extension might be a better choice.
The quality of advice you receive matters enormously here. The FCA's review of later-life mortgage advice found many firms fell short of the standards it expects, leading to almost 400 misleading promotions being removed or corrected. It is worth choosing an adviser who explains the full picture, not just the headline cash sum.
Getting this decision right starts with a conversation. Speak to the team at Moneysprite, and we will talk you through what equity release could mean for your home, your family, and your future.
A lifetime mortgage is not suitable for everyone and may affect your entitlement to means tested benefits, so it is important to seek financial advice before taking any action. If you are considering releasing equity from your home, you should consider all options available before equity release.
The interest that may be accrued over the long term with a Lifetime Mortgage, may mean it is not the cheapest solution. As interest is charged on both the original loan and the interest that has been added, the amount you owe will increase over time, reducing the equity left in your home and the value of any inheritance, potentially to nothing.
Although the final decision is yours, you are encouraged to discuss your plans with your family and beneficiaries, as a Lifetime Mortgage could have an impact on any potential inheritance. We would also encourage you to invite them to join any meetings with your Financial Adviser so they can ask questions and join in the decision, as we believe it is better to discuss your decision with them before you go ahead. This is a referral service.
Moneysprite is a trading style of Money Sprite Limited which is an appointed representative of The Openwork Partnership, a trading style of Openwork Limited which is authorised and regulated by the Financial Conduct Authority.
Approved by The Openwork Partnership on 8/09/2026.
