Lawyers for Equity Release Mortgage

See our mortgage legal advice for a description of our normal mortgage product, including a description of what a normal mortgage is.

Equity Release mortgages are mortgages granted by a specialist lender (Aviva, and Legal & General, seem to be two of the market-leaders), normally over a property you already own (they can be granted on property newly purchased, as part of the purchase process, but that isn’t the most common situation we encounter). The essential difference between an Equity Release loan and a normal loan is that what would otherwise be made as (usually, monthly) payments of interest and repayment of the loan, are not paid by the borrower during the term of the loan, but instead are capitalised into the value of the loan – that is to say, no repayments are made, but the amount borrowed is constantly increasing by the amount that normally would have been repaid.

The anticipated scheme is that the home may be sold during the expected term of the loan (calculated by reference to the anticipated life-span of the borrower) from which the capital (with its compounded interest payments) will be repaid, then. Since the most likely scenario in which this might arise is when the house is sold by the home-owners’ executors, after the owners’ death, so the borrower themselves might not be too concerned about repayment – since in essence the overall effect would be simply to reduce their estate after their deaths. That is to say, the homeowner will enjoy during their lifetime, part of the value of their home that otherwise they would have left to their successors to enjoy, instead.

The equity release market has been subject to some scandal, apparently due to some unscrupulous providers selling expensive products – but the fundamental scheme, with normal lenders, could be a sound and sensible option for many people, particularly the elderly who might be ‘asset-rich’, but relatively ‘cash-poor’. No-one is obliged to provide for their successors in preference to themselves!

Apart from handling the proceeds, properly, the main element of the product from our perspective is certifying to the lender, accordingly to their technically complex and demanding requirements, that your property offers legally satisfactory security for their loan. It is not a dissimilar process to our Property Report product, and is the same as a large element of what we do in our conventional conveyancing service for buyers with a mortgage.

We don’t generally do anything for new clients until our process of client retention has concluded – this involves agreeing the scope of what we are doing for the price (our terms are below), setting-up our client record (that includes ID checks), and producing the bill (payment in advance is required for all new clients).

After that, the production of the mortgage is a job that we can undertake in a few hours once we can schedule it in our workflow, that can depend on how busy we are at any particular time. We would not usually take-on a job for which we could not engage within about a working week.

A completed mortgage may then need to be submitted to HM Land Registry for registration. The time HM Land Registry take to process such a registration varies greatly, depending on how busy they are. Some applications are processed very quickly, up to “next day”; however, most applications appear to languish awaiting HM Land Registry attention; in 2023 many applications were taking about 3 months to be registered – and some types of application can take even longer than that, unfortunately. However, once submitted HM Land Registry process applications on any title in order of submission – so their delay ought not to affect the priority of your application relative to other matters on that title.

Your supplier is CLC-regulated Mounteney Conveyancers, that charges VAT some customers may be able to reclaim

For acting on an Equity Release Mortgage we charge £750 + 0.1% of loan + VAT.

In addition there may be some other costs our client will need to pay, such as search fees, Land Registry fees and possibly bank transfer fees; such costs tend to be relatively modest, and we don’t apply any mark-up on them for processing them, i.e. you will only have to pay precisely what the costs are, and nothing more.

There is more about our fees on our website here