The application is the first step you take, after speaking with an equity release specialist to find a product that fits your needs. Approval is necessary to move forward in receiving your tax free cash. The lender, type of equity release selected, and your solicitor determines how quickly the process will be.
How Long Does an Equity Release Application Take?
The entire lifetime mortgage process, including the application, should take six to eight weeks. Home reversion plans can take around eight to ten weeks. Hiring a solicitor who works with each provider and the individual requirements could speed up the whole process and this can usually be recommended by your equity release adviser.
The Equity Release Application Steps
The steps for the application process are:
• Submit application to provider
• Provider orders a valuation
• Solicitor begins legal work
• Offer is made by equity release company
• Date of completion is set
The provider will go through your application checking to make sure it meets its qualification criteria and request any documents they need to approve or reject the application. A few equity release lenders do require credit checks and voters roll checks. The valuation is part of the approval process. The company will hire a local surveyor to assess your property condition and place a current market valuation on the house based on recent sales.
The equity release valuation determines the amount of tax free cash possible for release. During this time the solicitor will begin checking the property for freehold or leasehold issues. The equity release solicitor will also check for any mortgage currently outstanding & if so will request a current lenders redemption statement.
A successful valuation plus the application and all investigative work can lead to a mortgage or home reversion offer. This proposal is sent to you allowing you to look it over with an independent solicitor. If you agree to the terms a completion date will be set. One the day of completion the solicitor will receive the money to settle any outstanding mortgage you have. Any fees the provider charges or your adviser requires will be deducted from the equity release funds. The remaining balance will be directly deposited into the bank account of your choice, or by cheque if preferred.
Rejection of Your Equity Release Application
The possible means for rejection include:
• The youngest homeowner named on the mortgage or title deed is not of qualifying age.
• Property valuation is not enough to meet the minimum or maximum criteria of the provider.
• Property type does not meet lender eligibility criteria e.g. concrete construction or grade 1 listed building.
• You reject the equity release offer made by the lender due to change in application criteria such as down valuation.
If your application fails with one provider, you may fill out another application for a different company and product. It is best to speak with a qualified independent equity release adviser before doing so. A lifetime mortgage adviser can help you determine which companies you may qualify for. Providers do have different qualifications for age and home value. Some will allow you to not include a partner of non-qualifying age on the application if they are also not present on the deeds.
Declining an equity release application does not mean another company will refuse to work with you, providing you meet their qualifications. It will extend the application process beyond the six to eight weeks or eight to ten weeks it takes for lifetime mortgages or home reversion, respectively if re-application is necessary.
Require further information?
Use the form below to request further information about this topic, or any equity release related matter, and an FCA regulated independent equity release adviser will be able to assist you over the phone, face-to-face, or via email.