Can you get equity release on a non-standard property?

Is your property eligible for equity release?

Written in line with our editorial policy.

So you’re thinking about equity release, but unsure if your property meets the eligibility requirements? In today’s article, we look at the potential for taking out equity release on non-standard properties.

Until recently, it was often very difficult to get equity release on homes that were anything other than standard construction types. Fortunately, lenders today are more flexible and accepting of equity release on non-standard properties, including homes of non-standard construction and those used partly for commercial reasons.

That said, you may find it slightly more challenging to get equity release on non-standard property types, which is why seeking specialist advice can make all the difference. In this guide, we’ll take a look at what you need to know, including:

• Can you get equity release on properties of non-standard construction?
• Are any other property types potentially ineligible for equity release?
• Leasehold properties
• Equity release on mobile homes
• Equity release on park homes
• Equity release on commercial properties
• Other property types
• Find out if your property is eligible for equity release

Can you get equity release on properties of non-standard construction?

When considering your application, equity release lenders look at some key factors to check your eligibility. In addition to your age (you must be over 55), they will check your property type, value, location and condition. 

They will also check if your property is of ‘standard construction’ – typically this means being built of brick or stone, with a pitched tiled or slate roof.

When applying for equity release, non-standard construction homes typically feature:

• Timber frames
• Prefabrication
• Glass walls
• Steel frame
• Concrete construction
• Thatched roofs
• Tin roofs

If your property is of ‘non-standard construction’ then it may be harder to get equity release, but it might be possible. Each lender has their own strict criteria of what types of property construction they will accept. Let’s take a quick look at some examples…

Aviva will consider applications for properties of all roof types and timber framed constructions. However, they will not accept steel framed properties built before 1990 or timber-framed properties with cavity wall insulation installed after the original constriction.

Just will also consider applications for all roof types and post-1965 timber frames. They do not accept timber frame properties built pre-1965 or with spray foam insulation post construction. They accept steel frame and concrete block properties, but not poured concrete, single-skin or prefabricated homes. 

Canada Life will consider applications for properties of all types of roofing materials. They will not consider timber framed constrictions built between 1900–1960, prefabricated properties or those with a steel frame built before 31st December 2000. They will however consider timber framed properties deemed as being built pre-1900, or since 1960.

If you are considering equity release on a property of non-standard construction, make sure you speak to the team at Equity Release Wise. Our selected advisers are specialists who know which lenders are more likely to consider your application. Just call us on 0808 178 3055 or request a call back and we’ll arrange a no-obligation appointment for you.

Are any other property types potentially ineligible for equity release?

Whilst there are some property types that equity release lenders will typically give a blanket ‘no’ to, others are less black and white. 

Here’s a brief overview of what a few lenders say about some non-standard property types…

Leasehold properties

It is possible to get equity release on leasehold flats, maisonettes, houses and bungalows, though acceptance varies between lenders and some do give a firm ‘no’.

When making your application your lender will want to see:

• How many years are left on your lease: typically providers require a minimum of 75 years, but some may require over 100 years.
• How much your ground rent charges are.
• A copy of your lease agreement.

With Aviva, for example, you can typically unlock equity from most kinds of leasehold houses, flats or maisonettes. Their policy is that the number of years you have left on your lease plus the age of the youngest borrower must equal at least 160. 

You may be asked to consider buying the freehold before or as part of an equity release agreement.

Equity release on mobile homes

Unfortunately you cannot do equity release on mobile homes or houseboats. As with standard mortgages, lenders need to secure the loan against the registered title of your property. As mobile home owners typically don’t own the land and they aren’t a leasehold property, there’s nothing to secure the loan against. 

In addition, mobile homes tend to depreciate in value over time, unlike houses and bungalows which usually increase in value over a number of years. Mobile homes simply don’t offer lenders enough investment security.

If you were planning to do equity release on a mobile home, downsizing your mobile home or moving to another type of property could provide a cash boost. There are other alternatives to equity release for you to consider, too.

Equity release on park homes

Park homes are classed as mobile homes as you own the home but not the land that it sits on – and is not classed as a leasehold property. They typically depreciate in value and unfortunately do not offer the financial security that lenders require to make a loan offer. 

If you were planning to do equity release on a residential park home or have been researching park homes equity release, you may find these alternatives to equity release helpful.

Equity release on commercial properties

Is your property used partly for commercial purposes? If so, there are some lenders who will consider your application and others who won’t. 

Let’s take a look at what some providers say: 

Aviva: Will consider your home if you have ‘a small amount of personal business use taking place’, including a bed & breakfast, holiday letting, or a hair/beauty salon. They will also consider properties where there is agricultural use of the land.

Just: Will not accept any properties with commercial usage including bed & breakfasts, holiday lets, kennels and catteries, or properties with agricultural ties or livestock. 

Canada Life: Will consider properties with a small element used for some form of business or commercial activity, for example, an office for home working. They will not accept applications for properties involved in commercial farming or with any agricultural ties.

If you are looking into equity release on a commercial property then do call our team on 0808 178 3055 or request a call back. We’ll be able to connect you with one of our selected advisers to offer information and advice. 

Other property types

There are other property types that have traditionally been difficult when it comes to equity release, but which some equity release lenders may now consider. For instance, you may be able to arrange equity release on non-standard properties such as:

• Flats over takeaways: Aviva, Canada Life and Just will all consider properties adjacent to or above commercial properties.
• Properties with a flat roof: Canada Life, for example, accepts properties with flat roofs of up to 30%. Flat roofs of between 30% – 45% of your property will be considered on an individual basis. Just will consider properties with over 30% flat roofs on an individual basis.
• Properties with solar panels: These are acceptable to Just, for example, if they are owned or have a suitable lease.

Find out if your property is eligible for equity release

The above examples are by no means exhaustive. The individual lending criteria for today’s providers are extensive and do vary considerably. That’s why it’s essential you seek specialist advice from advisers with plenty of experience. 

So if you’re 55+ and looking to do equity release on a non-standard property, speak to our selected advisers today. They are specialists who will do their best to find a lender who will be able to offer you an opportunity to release cash from your property via equity release.

Call our friendly team today on 0808 178 3055 or request a free call back here to talk to one of our selected advisers.

About Richard Groom. A writer with 20+ years’ experience across several sectors including financial services, Richard has a passion for writing clear and simple content on even the most complex of subjects. In his spare time, Richard loves exploring the hills and mountains of the UK on long walks with his faithful cocker spaniel. Follow Richard on LinkedIn