More over 50s consider equity release to tackle rising debts

Nearly half of those aged over 50 are still paying off debts, according to new research from SunLife, which specialises in products for the over-50s. 

The company says clearing what’s owed is now a common reason for choosing equity release. 

The trend comes as the Equity Release Council, the group that monitors activity in this market, confirms borrowing is rising again. 

If you’re curious about how equity release works and whether it might suit your situation, here’s what to consider.

High debt levels among the over-50s

SunLife’s Life Well Spent 2025 report shows that 45% of people aged over 50 are still managing debt. Among this group, the average amount owed is £23,799, rising to £33,590 for homeowners.

The report further found that some 80% of over-50s were aware of equity release, with 13% considering it as an option. Some homeowners see the product as a way to boost their finances without selling up. 

Of those who had used equity release, 36% had utilised the funds to pay off debts and 44% to improve their homes. 

Equity release can provide the funds to settle long-standing debts, supplement retirement income or support family members.

• Find out more:what is equity release?

Equity release borrowing is rising

The figures from Sunlife follow statistics from the Equity Release Council, indicating that total lending rose to £639m in the third quarter of 2025, which is 4% higher than the same period in 2024.

There were a total of 4,932 new plans taken out between July and September 2025, with an average value of £116,507 for lump-sum loans. 

Lifetime mortgages are the most popular type of equity release. You take out a loan against your property, which is repaid from the proceeds when it's sold. 

The sum you can borrow depends on your age and how much your home is worth. You'll need to be at least 55, but the older you are, the more you can borrow. 

Exactly how much you can borrow will vary markedly from provider to provider. Currently, at age 65 you'll typically be able to borrow a maximum of between 35% and 39% of the market value of your home, rising to between 40% and 44% at age 70. 

Borrowers can opt to take a lump sum – where interest is charged on the whole amount at a fixed rate – or take chunks of cash when they need it, only paying interest on the money they've taken. 

By spreading out the amount you borrow in this way (known as ‘drawdown’), you’ll reduce the impact of compound interest. 

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Should you use equity release?

Equity release can prove useful if you have value tied up in your property, but are worried about having enough to live on in retirement, paying for care or funding large expenses. 

You can use the tax-free cash however you wish and will be able to stay in your home for the rest of your life or until you move into care.

Taking out an equity release plan is not a decision to be taken lightly. It can be very expensive, especially if you don't make any voluntary repayments. This means that the amount you can leave behind for loved ones will be reduced. 

If you change your mind, repaying your loan early often triggers an early repayment charge. 

• Find out more: equity release pros and cons

What are the alternatives to equity release?

Equity release is more likely to be suitable if you’re older, own an expensive property outright that’s expected to increase in value and you don’t intend to pass it on when you die. 

If you decide that equity release isn’t for you, here are some alternatives: 

• Downsizing: Our investigation found that you can potentially unlock hundreds of thousands of pounds by moving to a smaller property, even after paying stamp duty.
• Remortgaging: Increasing numbers of lenders offer retirement interest-only mortgages (RIOs). These allow you to pay off the interest on the loan each month and the original value of what you borrowed is repaid when you die or move out.
• A personal loan or credit card: For smaller amounts, borrowing via an unsecured personal loan or interest-free purchase credit card could be much cheaper than equity release, as long as you can keep up with repayments.
• Rent a room: If you have a spare room in your home that you’d be happy to rent out, the government’s Rent a Room scheme lets you earn up to £7,500 a year tax-free. The tax exemption is automatic, so you only have to fill in a tax return if you earn more than £7,500 in any year.

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Why professional advice is essential

You must take professional advice before releasing equity from your home, and it’s important to choose an adviser who specialises in this area. 

• CeRER (Certificate in Regulated Equity Release) – awarded by the Institute of Financial Services (IFS).
• CER (Certificate in Equity Release) – awarded by the Chartered Insurance Institute (CII).
• ERMAPC (Equity Release Mortgage Advice & Practice Certificate) – awarded by the Chartered Institute of Bankers in Scotland. The ERMAPC was discontinued a few years ago but may still be held by some advisers.

You can search for qualified advisers through the Society of Later Life Advisers. The Equity Release Council also has a member directory.