Understanding how releasing equity works is important, especially if you are thinking about remortgaging, moving home, or exploring options such as equity release.

Put simply, equity is the difference between the current market value of your home and the amount you still owe on your mortgage.

As you repay your mortgage and if your property increases in value, the amount of equity you have builds up over time.

Knowing how much equity you hold can help you understand your options and decide how best to use it.

How Equity Builds Up

Each time you make a mortgage repayment, part of it goes towards reducing the amount you owe.

As this balance decreases, your share of the property, your equity, increases.

If property prices in Leeds rise while you own your home, this can boost your equity even further.

For example, if you bought your property for £200,000 with a £150,000 mortgage, and the property is now worth £250,000 with £100,000 remaining on the mortgage, you would have £150,000 in equity.

The more equity you hold, the more flexibility you may have when it comes to borrowing or releasing funds.

How Equity Can Be Used

Many homeowners in Leeds choose to access the equity in their home by remortgaging.

This allows you to release some of the value as a lump sum, which can be used for home improvements, supporting family members, or repaying debts.

For those aged 50 and over, another option is to explore equity release products such as a lifetime mortgage.

This can provide access to your property’s value without the need to move or make monthly repayments.

Each approach has its own features, so it is important to weigh up which is right for you based on your goals and circumstances.

Things to Consider

Using the equity in your home is a significant financial decision.

If you release equity through a remortgage, your monthly repayments and total borrowing may increase. With a lifetime mortgage in Leeds, interest builds up over time and can affect the value of your estate.

It is also worth considering how releasing equity might affect any benefits you receive.

A qualified mortgage advisor in Leeds can help you understand all the implications and explore whether alternative options may be more suitable.

Date Last Edited: June 13, 2025