Equity release allows homeowners aged 55+ to access the value tied up in their property without moving. In 2026, with average UK house prices at £298,000 and rising living costs, it's an increasingly popular option.
The most common form is a lifetime mortgage, where you borrow against your home's value. Interest rolls up over time, and the loan plus interest is repaid from the sale of the property when you die or move into care.
The impact on your estate can be significant. On a £150,000 lifetime mortgage at 6.5% interest (a typical 2026 rate), the debt approximately doubles every 11 years. After 20 years, the amount owed could exceed £300,000.
This can dramatically reduce — or even eliminate — the inheritance you leave. However, most modern equity release plans include a 'no negative equity guarantee', meaning your beneficiaries will never owe more than the property is worth.
If you're considering equity release, it's essential to update your Will and wider estate plan. The reduced estate value may mean trusts or IHT planning are no longer necessary, or it may change the balance of gifts between beneficiaries.
Alternatives to equity release include downsizing, renting out a room, or using other savings and investments. Each has different implications for your estate plan.
At Castle Family Legal, we can review how equity release fits into your overall estate plan and ensure your Will reflects your current position. Contact us for a free consultation.
