Can You Move Home With Equity Release?

Can You Move Home With Equity Release?

Yes, you can often move home after taking equity release. Many lifetime mortgages can be transferred to another suitable property through a process known as porting.

However, transferring the plan is not automatic. Your lender must approve the new home, reassess the property and confirm how much borrowing it will support.

You may also need to repay part of the lifetime mortgage if the new property is worth less. Early repayment charges could apply in some situations.

Moving home is therefore possible, but the financial structure of the move must be understood before you commit to a purchase.

At a Glance

• Many lifetime mortgages can be transferred to a new property.
• The new home must meet the existing lender’s property criteria.
• A valuation and legal process will normally be required.
• Downsizing may mean repaying part of the outstanding loan.
• Early repayment charges may apply if the plan cannot be transferred.
• Home reversion plans follow different rules from lifetime mortgages.
• Speak to your lender or adviser before marketing your current home.
• Do not exchange contracts until the equity release position is confirmed.

Can You Move House With a Lifetime Mortgage?

A lifetime mortgage is secured against your home. Therefore, selling that home affects the lender’s security.

When you move, the lender must decide whether the new property provides acceptable security for the outstanding borrowing. If it does, the lender may allow the lifetime mortgage to move with you.

This is called porting a lifetime mortgage.

Porting does not usually mean that the original legal charge physically moves between properties. Instead, the charge against your current home is released when it is sold. A new charge is then registered against the property you purchase.

The product may remain broadly the same. However, the lender will normally complete new property, valuation and legal checks.

Homeowners who need a broader explanation can first read how a lifetime mortgage works.

Is Every Equity Release Plan Portable?

Not every equity release arrangement has the same moving rules.

Most modern lifetime mortgages are designed to permit a move, subject to lender approval. However, the precise conditions appear in the original offer, mortgage terms and later-life lending documentation.

Older plans may offer less flexibility. Some may contain stricter property requirements or repayment conditions.

Portability may depend on:

• The type of equity release plan
• The original lender’s terms
• The value of the new property
• The outstanding mortgage balance
• The age of the youngest borrower
• The construction and condition of the new home
• Whether the property will remain your main residence
• Whether the lender still considers the loan acceptable

The Equity Release Council explains that moving or downsizing can remain possible. However, borrowers may need to repay part of the money released when moving to a lower-value home. Its guidance on future moving plans provides useful background.

What Happens When You Port Equity Release?

The exact process varies between lenders. However, it will normally include the following stages.

1. You contact the lender or your adviser

Do this before putting your current home on the market where possible.

The lender can explain its porting policy, property requirements and likely fees. Your adviser can also review whether keeping the existing plan remains appropriate.

2. The proposed property is reviewed

The lender will need information about the new home.

This may include:

• Address
• Property type
• Estimated value
• Construction method
• Tenure
• Remaining lease term
• Occupancy arrangements
• Condition
• Flood, subsidence or environmental risks

An initial review can identify obvious problems. However, it is not the same as formal approval.

3. The lender arranges a valuation

The new home must normally be valued by a surveyor approved by the lender.

The valuation is not a structural survey for your benefit. Its main purpose is to determine whether the property provides suitable mortgage security.

You may wish to arrange your own survey separately.

4. The lender calculates the permitted loan

The lender compares the outstanding lifetime mortgage against the value of the new property.

If the existing balance falls within its permitted loan-to-value limit, the full mortgage may be transferable.

If it exceeds that limit, you may need to repay part of the balance.

5. Solicitors complete the legal work

A solicitor will normally deal with the sale, purchase and lifetime mortgage transfer.

The existing charge must be removed from the property being sold. A new charge must then be registered against the replacement home.

Separate legal advice is an important part of the equity release process.

6. The sale, purchase and port complete

The lender releases its charge over the old property. The required borrowing is then secured against the new home.

Any required partial repayment is usually taken from the sale proceeds.

What Property Rules Apply?

A home that suits you personally may not meet a lifetime mortgage lender’s security requirements.

Lenders generally prefer properties that should remain saleable over the long term. This matters because repayment will usually come from a future sale.

Potential concerns may include:

• Non-standard construction
• Very short leases
• Retirement properties with restrictive resale terms
• Park homes
• Houseboats
• Properties above or beside commercial premises
• Homes with significant structural defects
• Properties with extensive land or unusual outbuildings
• Certain flood or subsidence risks
• Properties with agricultural restrictions
• Shared ownership arrangements
• Homes occupied under unusual tenancy arrangements

A leasehold flat may be acceptable. However, the remaining lease term, ground rent, service charges and management arrangements can affect the decision.

A retirement apartment may also require closer review. Exit fees, age restrictions and a limited resale market can concern some lenders.

Never assume that a property is acceptable because another lender has previously mortgaged it.

What Happens If You Are Downsizing?

Downsizing can create a technical problem because the new property provides less security.

For example:

• Current property value: £500,000
• Outstanding lifetime mortgage: £150,000
• New property value: £300,000
• Lender’s permitted borrowing on the new home: £120,000

In this example, the borrower may need to repay £30,000 when the move completes.

That repayment would usually come from the sale proceeds. The remaining £120,000 could then transfer to the new property, subject to approval.

The calculation will depend on the lender’s loan-to-value rules, your age and the product terms.

This is why the sale proceeds should not be fully allocated until the lender confirms the required repayment.

The wider decision may involve more than mortgage figures. Our guide to planning for retirement explains why housing, income and future needs should be considered together.

Could an Early Repayment Charge Apply?

An early repayment charge may apply when all or part of a lifetime mortgage is repaid.

Whether one applies during a move depends on:

• The lender’s porting terms
• The amount being repaid
• The reason for repayment
• How long has the plan been running
• Whether the new property is acceptable
• Any downsizing protection included within the plan

Some lifetime mortgages include downsizing protection after a qualifying period. This may allow the loan to be repaid without an early repayment charge when moving to a property the lender will not accept.

However, definitions and qualifying periods vary. The protection should not be assumed.

Some plans use fixed early repayment charges. Others may use calculations linked to market conditions or gilt movements.

Ask the lender for a written redemption statement before relying on any figure.

For a fuller explanation of voluntary and full repayments, read can you pay back equity release?.

What If the New Home Costs More?

Moving to a more expensive home does not automatically mean you can increase the lifetime mortgage.

You may be able to transfer the existing balance if the property is acceptable. However, any additional borrowing requires a separate assessment.

The lender may review:

• Your age
• The new property value
• Current loan-to-value limits
• Available product terms
• Whether further borrowing is permitted
• The reason for the extra borrowing
• Your future financial needs

The additional amount may be offered under different terms or at a different interest rate.

You may also need to fund the purchase through savings, sale proceeds or another suitable form of borrowing.

Homeowners comparing standard moving finance can read about moving home mortgages. Standard residential mortgages involve affordability and repayment assessments that differ from lifetime mortgage lending.

What If the Lender Rejects the New Property?

You may still have several options, depending on the circumstances.

These could include:

1. Choosing another property that meets the lender’s criteria.
2. Repaying the existing lifetime mortgage from the sale proceeds.
3. Applying for a different lifetime mortgage on the new home.
4. Using savings or other assets to reduce the required borrowing.
5. Considering another form of later-life lending.
6. Delaying the move until the financial position is clearer.

Replacing the plan may result in new advice, valuation, legal and arrangement costs.

The new interest rate may also be higher or lower than the existing rate. Early repayment charges on the original plan must be included in any comparison.

A replacement should not be considered solely because it permits the move. The total long-term cost and effect on your estate also matter.

Can You Move With a Home Reversion Plan?

A home reversion plan works differently from a lifetime mortgage.

Under a home reversion arrangement, you have sold all or part of your property to the provider. You retain the right to live there under the plan’s terms.

Moving, therefore, requires the provider’s agreement. The provider must consider its ownership interest, the sale proceeds and the suitability of the replacement property.

You may be able to transfer the arrangement. However, the legal and financial process can be more complex.

The amount available to purchase the next home will also depend on the share owned by the provider.

Anyone with this type of arrangement should obtain advice specific to their contract. General lifetime mortgage porting rules should not be applied to a home reversion plan.

You can compare the two structures within our main equity release guide.

Costs to Include When Moving

Porting does not remove the normal cost of moving home.

Your budget may need to include:

• Estate agent fees
• Conveyancing fees
• Lifetime mortgage legal fees
• Valuation charges
• Removal costs
• Survey costs
• Stamp Duty Land Tax
• Required mortgage repayment
• Early repayment charges
• Product or arrangement fees
• Property repairs
• Leasehold or management fees

Stamp Duty Land Tax depends on the purchase price and your circumstances. The rules may differ in Scotland and Wales.

The Connect Lifetime stamp duty calculator can provide an initial estimate. A solicitor or tax professional should confirm the final amount.

How Long Does Porting Take?

There is no fixed timescale.

The process depends on:

• How quickly the property information is supplied
• Valuer availability
• Property complexity
• Legal searches
• The wider property chain
• Whether a partial repayment is needed
• Whether further borrowing is requested
• Whether the lender raises additional questions

A straightforward port may fit within a normal moving timetable. More unusual properties or legal arrangements can take longer.

The Equity Release Council’s technical material shows that porting can involve an initial request, assessment, valuation, formal offer and legal completion.

The safest approach is to start the discussion before agreeing a completion date.

Questions to Ask Before You Put Your Home on the Market

Ask your lender or adviser:

• Is my lifetime mortgage portable?
• Does the plan include downsizing protection?
• What properties will the lender not accept?
• How will the permitted balance be calculated?
• Could I need to make a partial repayment?
• Could an early repayment charge apply?
• What valuation and administration fees apply?
• Can I request additional borrowing?
• Will the interest rate remain unchanged?
• How long does approval normally take?
• What happens if the property chain changes?
• When should my solicitor contact the lender?

Request important answers in writing. This reduces the risk of relying on an informal assumption.

Why Advice Matters Before Moving

Moving home changes the property supporting the lifetime mortgage. It may also change your future costs, estate value and access to care or family support.

Suitable advice should consider more than whether the lender permits the move.

It should also examine:

• Whether the next home will remain suitable
• How much capital the move will use
• Whether the mortgage balance remains manageable
• How much equity will remain
• Whether benefits could be affected
• Whether family members should be involved
• Whether another financial route may be more suitable

The FCA expects equity release advice to reflect the individual’s needs, circumstances and motivations. It has also warned that unclear promotions or unsuitable advice can create significant consumer harm.

A home is both a financial asset and a place to live. The right decision must respect both functions.

Speak to an Equity Release Adviser Before Moving

Moving home with equity release may be possible, but the sequence matters.

First, check the existing plan. Next, establish whether the new property is acceptable. Then confirm the required borrowing, repayment and charges before committing to the purchase.

Connect Lifetime can explain the technical process, examine the plan terms and help you consider the available options.

Speak to an equity release adviser before placing financial reliance on a proposed move.

Frequently Asked Questions

Can I sell my house if I have equity release?

Yes. However, the lifetime mortgage must normally be transferred to an acceptable property or repaid from the sale proceeds.

Can I transfer equity release to any property?

No. The replacement property must satisfy the lender’s valuation, construction, tenure and saleability requirements.

Do I have to repay equity release when downsizing?

You may need to repay part of the balance if the new property cannot support the full outstanding loan.

Will my lifetime mortgage interest rate change?

The existing rate may remain attached to the transferred balance. Further borrowing could have a different rate. Your lender must confirm this.

Can I move into a retirement apartment?

Possibly. However, lease terms, service charges, resale conditions and exit fees may affect lender approval.

Can I move abroad with a UK lifetime mortgage?

A UK lifetime mortgage will normally require the secured property to remain your main UK residence. Moving abroad permanently may require repayment.

Can I rent out the new property?

Usually not. Lifetime mortgages normally require the property to remain your main residence. Letting it without permission could breach the mortgage conditions.

Should I make an offer before obtaining lender approval?

You can make an offer, but it should remain subject to the lender accepting the property. Do not exchange contracts until the funding position is confirmed.

Important information: A lifetime mortgage is a loan secured against your home. It may reduce the value of your estate and affect your entitlement to means-tested benefits. Interest may be added to the loan and increase the amount owed. Ask for a personalised illustration explaining the features, costs and risks.