Equity release interest calculator
See how much a lifetime mortgage could grow to if the interest rolls up, at a rate you choose. Many modern lifetime mortgages let you pay some or all of the interest, which can reduce or stop this roll-up. This is a guide only.
See how interest could roll up over time
See how much could be owed if interest is rolled up and compounded annually, using a rate you choose. Press Calculate my estimate, add your details, and your result will appear on screen. This is a free transparency tool, not a personalised illustration.
See your result on screen instantly
Enter your details below and your total owed figure will appear straight away.
Many modern lifetime mortgages let you pay some or all of the interest each month, which can reduce or stop this roll-up altogether.
See year by year
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The interest rate you enter above is an example only, chosen by you. It is not a rate we are offering or quoting you.
These figures are illustrative only. They are not advice, not a quote, and not a personalised illustration. Actual products, rates and features available to you will vary.
Many modern lifetime mortgages let you pay some or all of the interest, which can reduce or stop this roll-up.
Every lifetime mortgage we advise on includes a no negative equity guarantee, so you will never owe more than your home is worth.
This estimate is provided for illustrative purposes only and does not constitute regulated financial advice.
How the interest calculator works
On a lifetime mortgage where nothing is paid, interest is charged on the loan and then on the interest already added. That is compounding, and over many years it can significantly increase the amount owed. It is why, on a lifetime mortgage, the interest is the main cost over time.
The calculator shows how a sum could grow at a rate you enter, compounded once a year, from your age now to an age you choose. If there are two of you, it runs from the younger person's age.
A rough illustration
Borrow £50,000 at 6% with nothing paid back, and after ten years you would owe roughly £89,000. After twenty, roughly £160,000. Same loan, untouched.
That is not a reason to avoid equity release. It is the reason to borrow only what you actually need, and to know that you have options.
You are not obliged to let it roll up
Modern plans let you pay some or all of the interest if you want to, monthly or ad hoc, with no penalty, within the lender's terms. Pay the interest each month and the balance does not grow at all. Pay some of it and it grows more slowly. Pay none and it rolls up as above.
If you pay all the interest, the balance stays at the amount you borrowed, so comparing the two shows the difference paying makes. Read more about interest only lifetime mortgages.
Drawdown can keep the interest down
Most plans also include a drawdown facility. You take what you need now, leave the rest in an agreed reserve, and only pay interest on what you have actually taken. The reserve is not a guarantee. A drawdown facility is agreed with the lender, but the terms of future drawdowns are the lender's. Compare drawdown or a lump sum.
Fixed for life, and protected
Lifetime mortgage rates are fixed for life, so you know the rate from the start. Every lifetime mortgage we advise on includes a no negative equity guarantee, so you will never owe more than your home is worth.
Why it is an estimate
The rate you enter is an example only, chosen by you. It is not a rate we are offering or quoting you. The actual interest rate and fees charged will depend upon your circumstances. To see roughly how much you could release, use our equity release calculator, and to understand the full costs, read what equity release costs.
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Understanding your estimate
How does the interest calculator work it out?
It compounds the interest once a year. Each year, interest is charged on the amount borrowed plus the interest already added, at the rate you enter, from your age now to the age you choose. If there are two of you, it runs from the younger person's age.
Do I have to let the interest roll up?
No. Modern plans let you pay some or all of the interest if you want to, monthly or ad hoc, with no penalty, within the lender's terms. Pay the interest each month and the balance does not grow at all. Pay some of it and it grows more slowly. Pay none and it rolls up.
Is there an interest only lifetime mortgage calculator?
This calculator shows how a lifetime mortgage balance could grow if nothing is paid, at a rate you choose. If you pay all the interest, the balance stays at the amount you borrowed, so comparing the two shows the difference paying makes. The figures are illustrative only and are not advice or a quote.
Does the interest rate change over time?
Lifetime mortgage rates are fixed for life, so you know the rate from the start. The rate you enter here is an example only, chosen by you. It is not a rate we are offering or quoting you, and the actual interest rate will depend upon your circumstances.
Can I end up owing more than my home is worth?
No. Every lifetime mortgage we advise on includes a no negative equity guarantee, so you will never owe more than your home is worth.
Does drawdown reduce the interest?
It can. Most plans include a drawdown facility, so you take what you need now and only pay interest on what you have actually taken. The reserve is not a guarantee. A drawdown facility is agreed with the lender, but the terms of future drawdowns are the lender's.
What happens after I submit my details?
Our team will call you personally to talk through your situation. The initial conversation is completely free and there is no pressure or obligation to proceed. They will ask a few questions about your situation, explain your options in plain English, and give you an honest assessment of whether equity release could work for you. If it is not right for you, we will tell you that too. You stay in control of every decision throughout.
What does equity release cost?
The initial conversation is free. Our advice fee is a maximum of £1,495 and is only payable if your case completes. Other lender and solicitor fees may apply, and on a lifetime mortgage the interest is the main cost over time.
Prefer to just chat first?
Ask Bruno any question about equity release, or call our team directly for a free conversation about your options.