Page last updated – 5th March 2023
Equity Release Completion: What Happens on the Day?
Congratulations! You’ve reached the final stage of the equity release process – completion day! This is the day when the equity release provider releases the funds to you and registers a legal charge over your property.
On completion day, your conveyancer or solicitor will receive the funds from the equity release provider and transfer them to your account. This means that you will finally have access to the equity that has been released from your property.
According to the Equity Release Council, the average amount released through a lifetime mortgage in Q4 2022 was £89,890. The average interest rate for a new lifetime mortgage plan was 3.55%, slightly lower than the previous year.
This money can be used for a range of purposes, such as paying off debts, funding home improvements, or supplementing retirement income. Home improvements remained the most popular reason for equity release, accounting for 26% of all plans in 2022.
At the same time, the legal charge will be registered over your property. This means that the equity release provider has a legal claim over your property in the event that you are unable to repay the loan. The conveyancer or solicitor will manage this process to ensure that the legal charge is registered correctly and that all legal formalities are met.
If you want to learn more about equity release and how it works, we’ve put together a comprehensive guide on the topic. Our guide covers the different types of equity release, eligibility requirements, and more. It’s a great starting point if you’re considering equity release as an option to supplement your retirement income.
The Importance of Working with a Solicitor and Conveyancer
On completion day, you will be required to sign legal documentation related to the equity release transaction. The specific documents that you will need to sign will depend on the terms of your equity release agreement and the requirements of the equity release provider.
Some of the documents that you may be required to sign on completion day include:
- Equity Release Agreement: This document sets out the terms of your equity release loan, including the amount borrowed, the interest rate, and any fees or charges associated with the loan.
- Mortgage Deed: This document creates a legal charge over your property in favour of the equity release provider. This means that the equity release provider has a legal claim over your property in the event that you are unable to repay the loan.
- Property Information Form: This form provides information about your property, such as its boundaries, any planning permissions or building regulations approvals, and any issues or defects that may affect the property.
- Transfer Deed: This document transfers ownership of the property to the equity release provider.
Your conveyancer or solicitor will explain these documents to you and ensure that you fully understand what you are signing. They will also ensure that all the legal formalities are met, and that the documentation is signed correctly and legally. It’s important to take the time to read and understand these documents before signing them, and to ask any questions you may have to ensure that you are fully informed about the equity release transaction.
Throughout the completion process, your conveyancer or solicitor will liaise with the equity release provider to ensure that everything is done correctly and legally. This may involve checking that all legal documentation is in order, confirming that the funds have been released, and ensuring that the legal charge is registered over your property.
Looking to release equity from your property but not sure where to start? Our equity release calculator can help. With just a few simple inputs, you can quickly calculate how much equity you could release and explore the different options available to you. Plus, our calculator provides enhanced figures without requiring any personal information from you.
Potential Issues on Completion Day
While completion day is an exciting time, there are potential issues that can arise during the process. Here are some of the common issues that you may face on completion day:
- Delays in the transfer of funds: Sometimes, there may be delays in the transfer of funds from the equity release provider to your conveyancer or solicitor. This could be due to issues with the provider’s systems or processes, or delays in receiving the necessary documentation.
- Incorrect documentation: There is a lot of legal documentation involved in the equity release process, and it’s important to ensure that everything is correct and legally binding. Errors or omissions in the documentation could cause delays or even legal disputes down the line.
- Issues with the property: Your conveyancer or solicitor will conduct property searches and surveys to ensure that there are no legal issues or complications that could affect the equity release transaction. However, issues could still arise on completion day, such as discovering defects or encumbrances on the property.
- Misunderstandings about the terms of the loan: It’s important to fully understand the terms of your equity release loan before signing any legal documentation. Misunderstandings or disagreements about the terms of the loan could cause delays or even legal disputes.
- Delays in registering the legal charge: The legal charge must be registered over your property on completion day to ensure that the equity release provider has a legal claim over your property. Delays in registering the legal charge could cause issues with the transaction.
To avoid these potential issues, it’s important to work with an experienced conveyancer or solicitor who can help ensure that everything is done correctly and legally. Your conveyancer or solicitor will be responsible for managing the completion process, and they will work to ensure that all legal requirements are met and that everything runs smoothly.
It’s important to work with an experienced conveyancer or solicitor during the completion process to ensure that everything is done correctly and legally. A survey conducted by the Equity Release Council found that 97% of customers who used a solicitor during the equity release process were satisfied with the service they received. This supports the idea that using a solicitor can increase customer satisfaction rates.
So, get excited! Completion day is finally here, and soon you’ll have access to the equity that has been released from your property. With the help of your conveyancer or solicitor, you can be confident that everything is done correctly and legally, and that you’re on your way to achieving your financial goals.