Equity release takes around 4 to 6 weeks to complete with a lifetime mortgage or around 6 to 8 weeks with a Home reversion
At Equity Release Online, we talk through some of the key stages involved with getting an equity release mortgage including:
The initial application for equity release takes just a few minutes to be completed and to get started, we just need:
This will allow Equity Release Online to provide a number of providers who can assist with your application. You can choose the best company based on your requirements and click through to proceed. This means that there are no fees for applying, we do not pass on your data to any companies without your permission and you are in full control of who you decide to work with.
Your property will be subject to a market valuation from a qualified surveyor which usually costs around £400 to £1,200 depending on the size of the property. Usually the larger the property, the more expensive the survey is.
When calculating the property valuation, the surveyor will consider the recent sale of other similar properties nearby in the last 3 to 6 months and also try identity any potential flaws or things in need of repair.
Other things that are inspected include:
From the equity release provider’s perspective, they want to know that your property does not have any long term issues and is not falling apart. Equally, they want to ensure that the property value will continue to rise over the next 10, 20 or 30 years so when the end of the loan term comes, they will be able to recover their funds successfully.
The lender will need to check if you have any other outstanding mortgages or loans secured against the property – and these will need to be cleared upon completion of the equity release product.
So once the customer releases equity from their home, they will typically pay off their outstanding mortgage payments and other secured debts.
Some equity release lenders do not carry out credit checking since you are not technically applying for a loan and are instead releasing funds from a valuable asset. However, a lot of equity release plans have monthly interest payments and some lenders believe that a person with an adverse credit history may be unreliable in meeting their payment obligations.
Whilst a credit check is carried out, many equity release companies are willing to consider those with a history of defaults, bad credit and even CCJs ( county court judgements) and this should not deter people from applying.
A credit check is usually instantaneous – so the application will not be slowed down in any way.
You are required to use an independent solicitor to help you complete the equity release deal. They will bring together all the information from the surveyor and the equity release provider and set a completion date for the funds to be transferred and the deal to be completed.
You are supposed to use a solicitor that is different to the one used by the equity release firm, to make sure that there is impartiality and the arrangement is in your best interests.
There are fees for using solicitors and these can range in the hundreds or thousands of pounds. The lender may recommend a specific solicitor that they work with that is approved by the Equity Release Solicitors Alliance and there may be a lower, set fee involved e.g £600.
In you are looking to complete as soon as possible on your equity release mortgage, there are some things you can do to speed up the application.
For instance, you can complete the application form faster if you have your property valuation and mortgage information at hand. No need to shuffle through the files at home or contact your bank, if you have this information ready, you can proceed quicker.
In terms of a property survey, your valuation may be valid for up to 3 months if complete by a RICS surveyor. So if you have gone to the lengths of having a prior valuation, you may have this available and ready to use for your application. Otherwise, you may have to wait a few days or weeks for your surveyor to arrive and perform the survey.
For outstanding loans and credit checks, if you can have any loans closed before applying, this will no doubt speed up your application and also potentially improve your credit score. Specifically, for things like outstanding credit cards and store cards, just closing these will make you a better credit prospect.
Finally, when choosing a solicitor, you can speed things up by having chosen your solicitor beforehand and agreed the fees. Otherwise, you can always use one recommended by your chosen provider.