An Equity Release Lifetime Mortgage isn’t as complicated or intimidating as it might first appear. When you think of it as a traditional interest-only mortgage - but with no fixed term - it starts to make perfect sense.
As you probably know, you can choose to make no monthly payments at all. However, because of compound interest, this could significantly reduce the equity left in your home later on. That’s why we always recommend making some form of repayment each month. Even small contributions - say, around £100 per month - can make a difference over time. To help you understand exactly how repayments affect your overall loan, we’ve created a unique equity release calculator. It shows you, in real numbers, the long-term benefits of making regular payments.
Go on — give it a try! - At the bottom of this page is an example based on a recent scenario we tested.
| Year | Property (£) | Loan balance (£) | Inheritance (£) |
|---|
Average house price (South of England, Jan 2026): £479,634
Predicted annual price growth (Savills): 2.8%
Equity released: £100,000
If you took out a £100,000 Lifetime Mortgage and made monthly payments of just £100, the equity in your property could remain unchanged over time. These small, consistent repayments can dramatically reduce the total cost of borrowing.
When combined with steady property growth (house price inflation) — typically around 2% - 2.8% per year — many homeowners find that releasing part of their home’s value today has only a minimal impact on the inheritance they plan to leave behind.
By making some repayments, you can preserve much of your estate’s value — allowing you to enjoy greater financial freedom today while still leaving a meaningful inheritance for your loved ones.
This approach gives you the flexibility to enjoy your money now while helping protect the legacy you want to pass on.
Handled wisely, equity release can be a practical and adaptable solution — enabling you to make the most of your home’s value today without compromising your family’s future inheritance.
This information is a guide only and should not be relied on as a recommendation or advice that any particular Equity Release product is suitable for you.
