Equity release fees and charges
One of the most common questions we are asked at Equity Release Supermarket is “what are the fees and charges involved in taking out an equity release plan?”
The answer depends on the three parties you choose to use while your plan is in progress. They are your financial adviser, your lender and finally your solicitor.
Let’s look at each of these in turn.
The fee for financial advice
To take out an equity release plan you must have financial advice, but the costs for this can vary dramatically as some brokers charge a fee based upon a percentage of the amount you borrow.
At Equity Release Supermarket we believe this is unfair.
The advice process involves researching the market, advising on and then processing your application. The work involved is the same if you borrow £10,000 or £500,000. So, we pass this saving onto you, our customer.
That’s why our fee is guaranteed to never be more than a competitive £995.
The table below shows you how our advice fee compares with the two biggest brokers in the equity release market.
Why pay at least £500 more?
||Equity Release Supermarket
||Key Equity Release
||Whole of the market advice fee. 1.99% of the amount released. Subject to a minimum of £1,499. That could be typically £1,936*
||2.25% of the amount released, subject to a minimum of £1,695. That could typically be £2,189*
Advice fees as published on broker websites as 23rd March 2020.
Average initial advance, lump sum plans in 2019 was £97,282. Equity Release Council, 3rd February 2020
Our open and honest approach to fees and charges
We believe that it is our duty as an impartial adviser acting on our customer’s best interests to be open and
honest with you about the fees you will pay before you start your application – so that there are no nasty
surprises along the way.
That’s why we clarify all your fees in both your Client Agreement and your Key Facts Illustration – documents we
prepare for you before your application goes to the lender.
And unlike some other brokers, we don’t charge any upfront application fees. With Equity Release Supermarket, you
only ever pay us one fee.
It’s only payable once your plan has completed and it’s guaranteed to never be more than £995. Plus, if your plan doesn’t complete, you won’t have to pay us anything: that’s our ‘no completion, no fee’ guarantee.
"A very professional service. Really impressed with their patience whilst we worked out what was the right deal for us. They helped us through each step without being pushy and were very responsive. Nothing was too much trouble and I like the fixed fee they charge rather than a percentage like other providers."
Mr & Mrs D - Maidstone, Kent
Like any mortgage, equity release lenders may charge an application fee to cover their set-up and legal costs for arranging a lifetime mortgage.
These can vary from £0 up to £995 and you can choose to either pay it from your equity release money or add it to your loan. Remember, if you add this fee to your loan, it will accrue compound interest.
The good news is with so much competition, many equity release lenders currently have special offers where there are no, or reduced application fees.
You can find more about these incentives using our unique ‘Compare Deals’ functionality.
Property valuation/survey fee
As with any mortgage, your lender needs an independent survey and property valuation for two reasons:
Firstly, to get a current market value for your property (based upon the recent sale price of property like yours in your area), so that the lender can calculate how much you can borrow.
And secondly, to ensure that the property is in good condition. If it isn’t, then the lender may decline, or insist that essential repairs be carried out, either before or after your plan completes.
Valuation fees are based on the estimated value of the property, however most lenders currently offer a free valuation when using Equity Release Supermarket’s advice service.
Equity Release Council (ERC) rules stipulate that your solicitor must be independent to the lender’s solicitor and under Equity Release Council rules you must have at least one face-to-face meeting with your solicitor.
You can read all about the role of your solicitor here.
We recommend the use one of our panel of solicitors by helping speed up the process (so that you get your money sooner) and they charge a very competitive fixed fee starting from £595+VAT (plus disbursements).
Our dedicated case handlers have online access to ensure that any issues that arise are dealt with promptly. For convenience, our panel solicitors can provide a home visit for your meeting, or at any of their local offices. (e.g. central London), whichever suits you best.
And like Equity Release Supermarket, if your plan doesn’t complete, there’s no fee to pay. That’s our panel of solicitors ‘no completion, no fee’ guarantee.