This guide provides general information and is not a substitute for personalised mortgage, tax or legal advice.
Written and reviewed by the Highhouse Money mortgage team · Last reviewed: 25 August 2026
Put simply, equity release is the family name and a lifetime mortgage is one member of that family. Every lifetime mortgage is equity release, but not all equity release is a lifetime mortgage — home reversion plans also sit under the same umbrella.
Because lifetime mortgages make up the vast majority of plans, many people use the two phrases to mean the same product. Knowing the difference helps when comparing options and reading provider literature. This guide is general information, not financial advice.
Questions to settle before comparing plans
- Do you want to keep full ownership of your home?
- Would you prefer to make payments or let interest build?
- Is leaving an inheritance important to you?
- Do you need a lump sum or smaller amounts over time?
- Have you discussed plans with your family?
- Have you considered alternatives such as downsizing?
What equity release means
Equity release describes ways for homeowners, typically aged 55 and over, to unlock tax-free cash from the value of their home while continuing to live in it. The money can be used for almost any purpose. The two recognised forms are lifetime mortgages and home reversion plans.
How a lifetime mortgage fits in
A lifetime mortgage is a loan secured on your home. You keep ownership, and the loan plus interest is normally repaid from the sale of the property when the last borrower dies or moves into long-term care. Interest can roll up, or many plans allow voluntary repayments to limit how much the debt grows. Some offer drawdown, so you take funds as needed rather than all at once.
How home reversion differs
With home reversion you sell a share of your property to a provider in exchange for a lump sum or regular payments, keeping the right to live there rent-free for life. The provider takes its share of the sale proceeds at the end. Because the provider waits an unknown period for its return, the price paid for the share is below market value.
Side-by-side comparison
| Feature | Lifetime mortgage | Home reversion | Retirement interest-only |
|---|---|---|---|
| Is it equity release? | Yes | Yes | No |
| Ownership | You keep it | Part sold to provider | You keep it |
| Monthly payments | Optional on many plans | None | Interest required |
| Affordability check | Not usually for roll-up plans | No | Yes |
| Repaid when | Death or long-term care | Provider takes its share on sale | Death or long-term care |
General features only; individual plans vary.
Why the distinction matters
Search results, adverts and conversations often blur these terms, which can make comparisons confusing. Being clear on whether you are looking at borrowing (a lifetime mortgage), a part-sale (home reversion) or a conventional later-life mortgage helps you ask the right questions about cost, ownership, flexibility and inheritance.
This page is general information, not financial advice. Equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits.
Frequently asked questions
Is a lifetime mortgage the same as equity release?
Not exactly. Equity release is the overall category of products that let older homeowners take money from their property without moving. A lifetime mortgage is one type within that category — by far the most widely used — alongside home reversion plans.
What is the other main type of equity release?
Home reversion. Instead of borrowing, you sell all or part of your home to a provider, usually for less than its market value, in return for a lump sum or income and the right to live there for life. With a lifetime mortgage you keep full ownership.
Is a retirement interest-only mortgage equity release?
No. A retirement interest-only mortgage requires monthly interest payments and is assessed on affordability, like a standard mortgage. It is a later-life mortgage rather than an equity release product, though it is often compared with lifetime mortgages.
Who can take out a lifetime mortgage?
Lifetime mortgages are designed for homeowners aged 55 and over. The amount available depends on age, property value and the plan chosen.
Does equity release affect inheritance?
Yes. Borrowing against your home, with interest usually added over time, reduces what is left to your estate. Some plans let you protect a portion of the property value for beneficiaries.
Sources and further reading
Where figures or rules can change, the position described is correct at the time of writing (25 August 2026) — always check the linked authoritative source for the latest position.
Related pages
Talk it through with an advisor
Every case is different. A short, no-obligation conversation with a whole-of-market advisor is often the fastest way to understand your options. Call 0345 512 0077 or send us a message.
Contact an advisor