Equity Release Fees

Equity Release Fees

Equity Release fees and how to save on them.
Many of the fees charged in the setting up of an Equity Release plan will be similar to those that are charged for a standard mortgage. However, if you research carefully, and ask the right questions, you can save more than £1,000 in costs.


Firstly, if you engage the services of an experienced independent advisor, they will have access to better deals in the market. Lenders give preferential terms to those who belong to certain groups. Advisors who are registered with the Equity Release Council tend to be a good place to start.


  • Paying off an existing Mortgage or other debts such as credit cards and loans.

    The best deals are not always through those who advertise on TV. TV adverts are costly and who pays for that…? Correct, you do! Look at the small print, and whist some advertise “free advice,” that advice is limited only to one lender.
    With nine current lenders in the market, if you are only receiving advice relating to one lender, how do you know that that is the best product for you? If you ask for independent advice, they may refer you to a sister company where you do pay fees. It is then you discover that those fees can be significantly higher than what is obtainable elsewhere.


    You must ask for “whole of market advice,” and ensure that the advisor confirms this. Other advisers give “restricted advice,” limited to a select panel of say three to five lenders.

  • A bona fide independent advisor will generally be able to offer you a package of benefits they arrange direct with the lenders. These can include:

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      A free survey. Surveys can cost up to 1% of property values although most have a fixed scale within certain property values.

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      A free application fee for many products. However, to obtain some of the lower interest rates or higher amounts, you may have to pay a fee up to £895.

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      An advice fee which is well worth paying to save on the above two fees alone! Some advisers have a fixed fee of say £1,495. Others set a percentage of the loan arranged and this is where looking at the Terms of Business of the advisor is essential. In some instances the advice fee is above 2%, others 1%, with a common minimum fee of £1,495. On a loan of £300,000 the 1% deal saves £3,000.

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      A free survey. Surveys can cost up to 1% of property values although most have a fixed scale within certain property values.

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      A free application fee for many products. However, to obtain some of the lower interest rates or higher amounts, you may have to pay a fee up to £895.

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      Legal fees. Your advisor will have contacts they have built up over many years. If they belong to the larger groups of advisors, they will have fixed price legal services. These solicitors agree to work for the same fee whether it takes six weeks or six months to get your case to completion. Currently, a common price is £650 including VAT.

    However, you are free to choose your own solicitor, but you should firstly seek out a solicitor who is experienced in Equity Release. Ask a solicitor for a fixed price as many now charge in excess of £150, plus VAT per hour. Almost all solicitors will tell you “they can do it because it is conveyancing”. The problem comes when they discover they have to sign the Equity Release Guarantee Certificate from the Equity Release Council. Many solicitors don’t carry the professional liability insurance for this work and then ask you to find another solicitor.

    Solicitors will charge for additional work like adding or removing a name from a title. Properties cannot be in a trust so if yours is, it has to be removed and the trust undone. In many cases, this involves new wills as some form of trusts at first death.

  • Valuations

    A valuation will be required by your chosen Equity Release Provider. The amount they are willing to lend is dependent on the value of the property, as well as your age, or the youngest age for a couple. Remember that this type of valuation is purely to assess the value of the property and its suitability as security for the proposed Equity Release. Even if you have had a recent survey, for any reason, the chosen Equity Release provider will still insist on having their own one done.


    A survey can throw up defects such as unsafe or old electrics, damp issues, and water damage due to a leaking roof. It can also identify a sagging roof where roof trusses have rotted or tiles are too heavy, or subsidence which causes cracks in the building.

    A surveyor can ask for specialist reports which can cost money depending on what is required. If you have the finance to fix known problems, it is recommended that you carry out the work before a survey. Some lenders place a limit on repairs and can reject your application if there is too much work to do.


    A good advisor will prepare an illustration for you that reflects your circumstances and needs. Ask your advisor to go through it with you carefully as soon as is practical, and don’t be afraid to ask as many questions as you need before you decide on your next step.
    The illustration is a regulatory requirement once a recommendation and application has been made. Section 11 of the illustration sets out the lenders application costs, the survey cost, advisor fee, and estimated legal fees. The advisor should also provide a fee agreement that matches the fee in the illustration. Solicitors will also give you a similar document for their work.

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