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Home reversion plans
With home reversion plans you sell a proportion or all of your property to a reversion provider in exchange for a lump sum to raise the funds immediately.
The ownership of your property would transfer to the reversion provider for a cash amount, unlike a lump sum mortgages or drawdown mortgage, so you would not receive the full value from the property when sold.
Only a lifetime mortgage would let you keep 100% ownership of your property to pass your wealth to your family and beneficiaries in the future.
You can continue to live in your own as a tenant rent free for your lifetime until you die or enter permanent residential care. If you only sell half of your property then at the end of plan half the equity value would revert to your estate and half to the reversion provider.
The home reversion plan is available if you are aged 65 and over and if you sell 100% of your home with a property value of £400,000 lenders would offer a lump sum shown in the following table:
| Home Reversion - maximum equity release |
| Your age |
Loan amount |
LTV |
| 65 |
£160,000 |
40% |
| 70 |
£184,000 |
46% |
| 75 |
£208,000 |
52% |
| 80 |
£236,000 |
59% |
| 85 |
£256,000 |
64% |
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Home reversion plans are designed to unlock capital from your home rather than income and do not charge interest that is rolled up or paid as you go along.
The reversion provider takes a share of your property and receives no income during your lifetime, so they expect to benefit from the capital gain realised at the end of the plan.
You must give the reversion provider a reasonable discount on the actual value of your home at the beginning. If you die early after only a few years the property is sold and you would have exchanged the full value for a smaller proportion which is not a good return for your estate.
Alternatives to equity release
There are many reasons for using equity release either as a lump sum or income although it is not suitable for everyone so before taking any action you should consider the alternatives.
People in retirement often find their income from State and other pensions may no longer meet their daily expenses, maintain their standard of living or pay for the unexpected events or clear debts.
People in retirement often find their income from State and other pensions may no longer meet their daily expenses, maintain their standard of living or pay for the unexpected events or clear debts.
As an alternative to equity release you can consider other routes and the following are a number of options you can consider:
| Alternatives to equity release |
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Downsize by selling your existing home |
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Use other savings or investments |
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Rent a room and take on tenants |
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Re-budget to live on less money |
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Your family could help with funds |
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Claiming grants or state benefits |
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Move to live with family members |
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To receive more income you could check to see if you are entitled to claim State benefits and grants and perhaps you could re-budget your finances to allow you to live on less money.
Family members could help you either with your income in retirement or if your property has a spare room, you could consider taking on a tenant to generate more income.
If you need a cash lump sum you could use your savings although you may be reluctant to use their emergency savings in case they are needed in the future.
You could consider downsizing to a smaller property to release the cash you need and this would avoid the extra cost of a mortgage although you would have less space and the expense of moving including stamp duty on your new home.
Must read links for equity release
Learn more about equity release and read our other pages about the types of lump sum and drawdown mortgages you can consider, alternatives to a lifetime mortgage and the steps you need to take to access cash from your home.
Ask us for a free equity release quote to see the maximum lump sum you can receive or the lowest interest rate for a specified cash amount from your home. Call Colin Thorburn on 020 8816 7501 to ask questions about your options.
Best Buys - Equity Release
Equity release lifetime mortgages
Lump sum and drawdown mortgages
Lump sum table - Maximum cash
Drawdown table - Maximum cash
Alternatives to a lifetime mortgage
Steps you take to access cash from your home
Free equity release quote
How can we help
As independent equity release advisers we do the work for you to search and find the best lifetime mortgages from the whole market. We also have access to unique offers not automatically available by lenders such as free valuations to help reduce your costs.
There are hundreds of products with varying terms & conditions which can have an impact on how you change the mortgage in the future. We can help you the technical aspects and advise you on the benefits of each lifetime mortgage lender.
We can recommend the most suitable and affordable options based on your needs now and in the future. Our service includes administration and advice which is Fee Free for loans over £60,000 as we receive a procuration fee direct from the lender. If the amount you are releasing is small, we will let you know if an additional fee would apply.
About Sharing Pensions
Sharingpensions.co.uk was created by its founder Colin Thorburn in 2001 to provide a resource to hundreds of thousands of people during retirement making their decision making easier and to select the best options.
Colin Thorburn has twenty years experience in retirement planning including equity release, is an individual authorised by the Financial Conduct Authority and business is submitted through Blackstone Moregate Ltd which is authorised and regulated by the FCA (no. 459051).
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