Here we break down five of the most common myths, helping you understand the facts and make informed decisions.
Myth 1: “I’ll no longer own my home”
Fact: With modern equity release products such as lifetime mortgages, you remain the legal owner of your home. The lender simply registers a charge against the property — similar to a standard mortgage — while you continue living there for as long as you wish or until you move into long-term care. In short: You stay in control and retain ownership, even as you access the wealth tied up in your property.
Myth 2: “There won’t be anything left to pass on”
Fact: While equity release reduces the value of your estate, many plans now include features like inheritance protection, allowing you to reserve a portion of your home’s future value for loved ones. Importantly, you can also use released funds to help your family during your lifetime — for example, assisting with house deposits or education costs — letting you see the benefit first-hand.
Myth 3: “Equity release is only for those in financial trouble”
Fact: This outdated view is no longer true. Many people use equity release as a proactive part of retirement planning. Common uses include: boosting retirement income, funding home improvements, helping children or grandchildren financially, paying off interest-only
mortgages, and avoiding the need to downsize. For many homeowners, equity release is a flexible financial planning tool — not just a last resort.
Myth 4: “The debt will spiral out of control”
Fact: While equity release loans do accrue interest, today’s products offer far more flexibility and safeguards than in the past. Many plans allow voluntary repayments, interest-only options to stop debt from compounding, and fixed interest rates for certainty. In addition, all plans approved by the Equity Release Council come with a 'no negative equity guarantee' — ensuring you or your estate will never owe more than the value of your home when it’s sold.
Myth 5: “It’s too complicated and risky”
Fact: Equity release is now one of the most carefully regulated financial products in the UK. Advisers must hold specialist qualifications and follow strict rules to ensure that clients are fully informed and that the product is suitable for their needs. With professional advice and clear explanations, equity release can be a straightforward and secure solution — not nearly as complex or risky as some people believe.
Final thoughts
Equity release isn’t right for everyone, but it’s certainly not the risky, outdated product it’s sometimes portrayed to be. With proper advice, thoughtful planning, and a clear understanding of how it works, it can help homeowners enjoy greater financial freedom in later life. If you’re considering your options, speak to a qualified adviser, such as the team at Prosper Home Loans LTD, for independent, expert guidance tailored to your situation.
