Can I Move House with Equity Release?

If you have an equity release plan, you might be wondering: “Can I move house with equity release?” The good news is that, in most cases, yes, you can. Many equity release plans are portable, meaning you can transfer them to a new home. However, there are some important things to check before moving.

Moving House with Equity Release: What You Need to Know

Your Lender Must Approve the New Property

When you move, your lender needs to approve your new home. They will check if it meets their criteria.

Accepted properties – Most standard houses and flats are fine.

Possible issues – Some lenders might not accept properties like retirement homes, certain leasehold flats, or homes in bad condition.

Valuation check – The lender will arrange a property valuation.

Tip: Before making an offer on a new home, check with your lender to avoid problems.

What Happens If the New Property is Worth Less?

If your new home is worth less than your current one, your lender may ask you to pay back part of your loan. This keeps the loan-to-value (LTV) ratio the same.

Some lenders allow partial repayments without penalties.

Others may charge early repayment fees.

What If the Lender Doesn’t Accept the New Property?

If your new home does not meet your lender’s rules, you may have to pay back the loan completely. This could include early repayment charges (ERCs).

Some plans include downsizing protection, which means you can repay your loan without a penalty if you move to a cheaper property.

Ask your lender if your plan includes this feature before you move.

Purchasing a House with Equity Release

Some people use equity release to buy a new home instead of staying where they are. This is called an Equity Release Purchase Plan.

How it works: Instead of taking out equity on your current home, you use an equity release plan to help buy a new one.

Benefit: You don’t need a traditional mortgage, making it a good option for retirees.

Considerations: You still need to meet the lender’s property criteria.

Tip: If you’re thinking about using equity release to buy a home, speak to a specialist adviser to find the best plan.

Potential Risks of Equity Release

Equity release can provide financial freedom, but it’s important to be aware of the risks before making a decision.

Impact on inheritance – Releasing equity reduces the value of your estate, leaving less for your loved ones.

Interest can grow quickly – Lifetime mortgages accrue compound interest, meaning the loan amount increases over time.

Effect on benefits – Receiving a lump sum from equity release could affect your eligibility for means-tested benefits like Pension Credit or Council Tax Support.

Tip: Always seek advice from a qualified equity release specialist to fully understand the long-term impact before committing.

Final Thoughts

Yes, you can move house with equity release – but your lender must approve the new property.

If the new home is worth less, you may need to repay some of the loan.

Some plans include downsizing protection, which allows you to move to a smaller home without penalties.

You can also use equity release to purchase a house instead of staying in your current home.

Before moving, always speak to your lender or an equity release adviser to check your options.