How Does Our Equity Release Property Plan Work?

Here is an illustration of how our equity release Property Plan works.

The payment made to you and the maximum our share can increase to will depend on your age, gender and whether you are a single person or couple. To make sure the exchange is absolutely fair, an independent professional valuer will value your home.

The payment made to you will be expressed as a percentage of the value of your home. For example, if your home is valued at £200,000 and we pay you £40,000, the Retirement Plus share is 20%.

Every month our percentage share in your property will increase at a fixed rate which will be set at the time you take out the equity release Property Plan. We will also agree the maximum percentage of which our share can increase, so you can guarantee a share of your property will be protected, no matter how long you live. Don't forget this Protected Share is the minimum share you will leave. Should you die or sell the property, your share of the property may be greater.

The costs of sale of the property are paid by you. If our percentage share of the property has reached its maximum level then we will pay the costs for our share leaving you to pay the costs of sale on your Protected Share. If your share doesn't actually cover those costs, we will pay any shortfall.

How it works

Table A | Illustrating the Retirement Plus share
This table illustrates how the Retirement Plus Share increases and how part of the property always belongs to you – the Protected Share – no matter how long you live. The rate at which our share increases is 0.64% per month. The starting percentage is 20%. The protected share is 46.66%.
Start of the year Our share at the start of the year Your share at the start of the year Your protected share Your share of future value How the share ownerships change over the year*
120.00%33.34%46.66%80.00%1.59%
221.59%31.75%46.66%78.41%1.72%
323.31%30.03%46.66%76.69%1.85%
425.16%28.18%46.66%74.84%2.01%
527.17%26.17%46.66%72.83%2.16%
629.33%24.01%46.66%70.67%2.33%
731.66%21.68%46.66%68.34%2.52%
834.18%19.16%46.66%65.82%2.72%
936.90%16.44%46.66%63.10%2.93%
1039.83%13.51%46.66%60.17%3.17%
1143.00%10.34%46.66%57.00%3.43%
1246.43%6.91%46.66%53.57%3.69%
1350.12%3.22%46.66%49.88%3.22%
1453.34%0.00%46.66%46.66%0.00%
1553.34%0.00%46.66%46.66%0.00%
1653.34%0.00%46.66%46.66%0.00%
1753.34%0.00%46.66%46.66%0.00%
1853.34%0.00%46.66%46.66%0.00%
1953.34%0.00%46.66%46.66%0.00%
2053.34%0.00%46.66%46.66%0.00%
*Our share will increase and your share will decrease by this amount during the year.
In this example, Retirement Plus would own a 53.34% share of the property after 12 years and 10 months. The Protected Share has been rounded down to the nearest whole number to simplify this illustration.

An example

Let’s say you are a couple aged 70. Your home is valued at £200,000 and you wish to raise £40,000 – the Amount Released through the Property Plan. In this case that’s 20% of the value of your home, so Retirement Plus will have the rights to a starting percentage of 20%. Your initial share is 80%, in other words £160,000 of the value of your home.

The share of your property that we would be entitled to increases by a rate that’s fixed at the beginning of the equity release Property Plan. If this fixed rate is 0.64% per month, then our share at the end of the first year will have increased from 20% to 21.59% of the value of the property. And so on, as illustrated in the table above.

The maximum our share can grow to will be fixed. In this case, our maximum share is 53.34% – so you have a Protected Share of 46.66%.

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