Over-66s remortgage to help cut IHT £6.2bn in equity released in past year by older homeowners

February 28, 2026

Equity release mortgage sales worth £6.2bn were made by borrowers aged 66 and over in the past year – an 11% increase from the £5.6bn recorded the previous year – partly driven by efforts to mitigate rising Inheritance Tax (IHT) liabilities and provide financial assistance to younger family members, says TWM Solicitors, a leading private wealth and family law firm.

Data provided to TWM by the Financial Conduct Authority shows that borrowers aged 67–70 took out £2.7bn in equity release mortgages over the year to 31 August 2025, up 10% on the previous year. Borrowers aged over 70 released £3.5bn, an 11% year-on-year increase.

TWM says the increase reflects the rising number of older homeowners unlocking wealth tied up in their properties — both to support their own living costs and to help children and grandchildren financially.

Equity release can form part of IHT planning. Taking cash out of a property using equity release reduces the net value of an estate and any subsequent IHT bills. Providing the money is gifted seven years before the homeowner’s death, that gift will be IHT-free.

Older generations of homeowners, particularly in the South-East, have seen significant house price growth over the last two decades. For many, their property is by far their biggest asset, often containing over a £1m in equity.

Equity release enables homeowners to access a tax-free sum from the value of their home, typically repaid after death or when moving into long-term care. However, borrowing later in life can materially reduce the value of an estate, particularly where interest rolls up over time, so the long-term impact requires careful consideration.

Released funds are increasingly being used to support what is often referred to as the “bank of mum and dad” or “the bank of Granny and Grandad”, as younger generations struggle with the cost of living, lower real wages, higher mortgage rates and the rising cost of home ownership.

Duncan Mitchell-Innes, Partner and Deputy Head of Private Client at TWM Solicitors, says: “With living costs rising and Inheritance Tax bills increasing, more pensioners are turning to equity release to unlock capital tied up in their homes.

“At the same time, younger generations are finding it harder to buy a property or even cover day-to-day expenses. We’re seeing families increasingly rely on older relatives for financial support. For some, equity release offers a way to provide that support without having to sell or downsize.”

He adds: “However, equity release is not suitable for everyone. The effectiveness of gifting strategies can depend on life expectancy, overall wealth, and future care needs. Professional advice is essential to ensure any arrangement aligns with wider estate planning objectives.”

Value of Equity Release Mortgage sales