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2026-02-15

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Mon to Fri: 9:30am - 4:30pm
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How to calculate if releasing equity from your home is worth it?

Wise Tip: Always conduct thorough research before making any investment.

by John Smith
2001-12-20
For some, releasing equity from our home sounds like a daunting prospect, but that’s generally because of a lack of financial education and, of course, because we’re all told from such an early age to pay down our mortgage; it’s our greatest asset, right? Wrong, Our home is not our greatest asset; it’s dead money; it’s money that could be working for us by creating more money through wise investment. Not sitting locked away in our home waiting for us to die so our children can use it. By releasing equity in our home, we can begin to build something measurable for ourselves or our Children; we’re still going to pay this mortgage off, remember, but this way, by releasing the equity locked away in our home, we have the opportunity to purchase CASH GENERATING assets with that capital. So, If you are considering remortgaging your property to release its equity to put to good use, Then you’ll need to know how to calculate this to see if it’s a viable option, and that’s where we come in. So before we get into this, we need to point out the obvious, we ARE NOT FINANCIAL ADVISORS & THIS IS NOT FINANCIAL ADVICE.

Wise Tip: Always conduct thorough research before making any investment.

This is How to calculate equity release

If were to calculate this properly, we need information from various sources. We need to speak with our current mortgage provider We need to speak with a local estate agent and check out some information online, principally Zoopla. We need to speak with a mortgage broker Okay, So firstly we need some answers regarding our current mortgage.

Well, just like our information-gathering process, we do this in stages.

We need to calculate how much equity you can release by taking the full redemption figure for your current mortgage away from the new loan amount. Let’s say that the redemption figure from your current mortgage was £240,000, and the new loan amount was £370,000 (based on a 90% loan to value and our property being valued at around 410k). This means our equity release in this instance is £130

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