Skip to content
Back to Insurance
Back to Holidays
Back to Saga Money
Back to Saga Magazine
A woman with her arms open wide on a hillside

Types of equity release

What are your different options for equity release?

What types of equity release are there?

If equity release sounds like a good option for you, the next step is to understand the two different types and decide which one will suit you best.

There are two types of equity release that allow you to access the value in your home:

What is a lifetime mortgage?

Much like a traditional mortgage, a lifetime mortgage is a loan secured against your home which accumulates interest each month.

How does a lifetime mortgage work?

Unlike a traditional mortgage, with a lifetime mortgage you don’t make monthly repayments. Instead, the interest is rolled up and compounded – that means you’ll pay interest on the interest (unless you decide to make full monthly interest payments).

The mortgage ends when you, or the last borrower if you’ve taken out a joint mortgage, die or move into permanent long-term care. The loan and interest are then usually paid back from the sale of your property. Because of this, lifetime mortgages will reduce the value of the estate you leave behind.

Why choose the Saga Lifetime Mortgage?

Saga Equity Release, provided by HUB Financial Solutions Limited, is a no-obligation, no-pressure service dedicated to finding out if equity release is right for you. You’ll need to pay an advice fee of £799 if you decide to proceed and take out a Saga Lifetime Mortgage. It's provided by Just and has a range of flexible options. For example:

  • You can take your money in one lump sum, or an initial smaller amount followed by extra payments as and when you need them (up to an agreed limit)
  • You could pay off some or all of the interest to reduce the loan’s overall cost
  • Certain health conditions and lifestyle factors are taken into account. That could mean you can borrow more or get a better rate
  • The Saga Lifetime Mortgage also comes with a money-back guarantee. So if something happens in the first six months which means you don’t need the money – like an unexpected windfall, for example – you can pay it back with no interest or charges. (The guarantee only applies if the initial payment you get is less than £150,000. There are other conditions. Find out more in the terms and conditions).
  • If you’re re-mortgaging an existing property you’ll also get the Saga Service Promise. This is where Saga Equity Release aim to release your money to your solicitor within 40 working days of Just accepting your application. If that doesn’t happen, and you’ve met all the eligibility criteria, you'll receive £100 (T&Cs apply).

Want to know how much you could release?

Use Saga's FREE lifetime mortgage calculator to get an instant estimate of just how much cash you could release from your property.

Fancy a free equity release guide?

The team at Saga Equity Release have written a guide to help you decide whether equity release is right for you. Request yours now.

What is a home reversion plan?

With a home reversion plan you sell part or all of your home to a provider in return for a cash lump sum or regular payments. You then stay in your home rent-free for the rest of your life.

Home reversion plans are much less popular than lifetime mortgages, and aren’t something Saga Equity Release offer.

What’s the difference between a lifetime mortgage and a home reversion plan?

With both types of plan, you stay in your home until you (or the last borrower if you have a joint mortgage/plan), dies or goes into permanent long-term care. The main difference is who owns your home.

How do you decide which type of equity release is right for you?

Start by talking to a financial adviser to make sure you understand the pros and cons of the two different types. Equity release in either form could also affect any means-tested benefits you get, so you should check this too before deciding to go ahead.

The Saga Equity Release service includes a check to see if releasing equity could affect any benefits you currently receive. Your adviser will also explore the alternatives to equity release. You will need to be 55 years old or over and own a UK property worth at least £70,000.

Ready when you are

The team at Saga Equity Release can help you decide whether equity release is right for you. Arrange a call back at a time that suits you.

0800 096 7120

Mon-Thurs 9am-8pm
Fri 9am-5:30pm
Sat 10am - 3pm
Sun - Closed
Excluding bank holidays

Request a call back
Equity Release Council logo

Peace of mind

Saga Equity Release and HUB Financial Solutions Limited are members of the Equity Release Council. This industry body ensures that all equity release products are safe and suitable for customers.

Saga Equity Release

Saga Equity Release is provided by HUB Financial Solutions Limited, who will pay us an introductory fee if you go ahead with equity release using the service. HUB Financial Solutions Limited, part of Just Group plc, is authorised and regulated by the Financial Conduct Authority. You can find out more about the service and fees on the Important information page.