Yes, you can release equity from your home when you’re under 55. But you won’t have as many options as you might have later on in life. That’s because most equity release products are only available to older people. For example, you can usually only get a traditional lifetime mortgage once you’re aged 55 plus or home reversion at 60 plus.
There are some equity release products available to younger customers though. You could think about remortgaging or downsizing, too. So there are options if you want to look into equity release under 55.
How can I release equity under 55?
If you’re after equity release for someone under 55, you can take out a lifetime mortgage like our Payment Term Lifetime Mortgage (PTLM), which you can take out if you’re aged 50 plus and at least one borrower is working. You make monthly interest repayments until you turn 75 or until you retire, whichever is sooner.
If you want to access the money tied up in your home without taking on any debt, you could consider downsizing. It’s not right for everyone, so we’ve put together an article on downsizing vs. equity release that might help.
If you’re happy you can continue to repay your standard mortgage and can meet your lenders' borrowing requirements, you could consider remortgaging with your current lender or moving to a new one. You can learn more in our article Remortgaging to release equity.
How much equity could you release?
If equity release sounds like it could be an option for you, use our equity release calculator to see how much money could be tied up in your home.
What should I bear in mind if I’m interested in a PTLM?
First of all, make sure a Payment Term Lifetime Mortgage (PTLM) is the right choice for you. Some important points to think through are:
- you must be in some sort of employment and able to pay the interest for the full payment term (if you’re a couple, that only has to be one of you)
- there’s no drawdown option
- you can opt for inheritance protection, but you may not have as much to leave loved ones
If all that works for you, it’s still worth double checking that there aren’t other, cheaper ways for you to borrow money. And bear in mind that a PTLM is a loan secured against your home – as a last resort your home may be repossessed if you don’t keep up your repayments.
Check for details like:
- any early repayment charges in case you want to pay the loan back early
- what options you'll have if you want to move in the future
- what impact it’ll have on any means-tested benefits you’re getting
You’ll also need to be clear about how your interest payments work. And at the end of your payment term, any unpaid interest rolls up. This means it's charged on the loan and on any interest already added.
What are the alternatives to equity release under age 55?
If you’re under 55 and don’t want to take out an equity release product, you can:
- Downsize to somewhere smaller and cheaper – but remember that you’ll need to budget for moving house, which can be expensive
- Increase your existing standard mortgage or move to a new one, releasing some money by taking advantage of any growth in your home’s value
- See if there are other, cheaper ways of borrowing the money you need, like a personal or home improvement loan