If you are in the market to unlock the value tied up in your property, you may have researched Santander equity release.

So, does Santander offer equity release?

Well, not directly, but the bank does provide access to equity release through its partnership with Legal & General.

BankingTimes has investigated Santander’s product portfolio in order to determine if the bank offers services to unlock property equity, like equity release, or any alternative solutions for property owners.

We are committed to providing readers with thorough and unbiased financial insights, and all our content undergoes extensive quality and fact-checking before publication. 

Here is what we have discovered.

STATEMENT: BankingTimes is a separate third-party information provider and therefore not related to Santander, and the information replicated in this section represents the interpretations of BankingTimes only and not the opinions of Santander. This piece does not constitute advice, or an incitement to enter any services or products provided by Santander.

Who is Santander?

A subsidiary of the Spanish Santander Group, Santander UK is one of the major banks operating in the United Kingdom.

With a long history dating back to its origins in the 19^th century, the bank’s established itself as a reputable institution serving millions of customers across the UK with a wide range of financial products and services.

Does Santander Offer Equity Release?

Santander does not offer equity release directly, but the bank refers clients to Legal & General (L&G), with which it has an arrangement that allows Santander clients to access an equity release product.¹

How Does Santander’s Arrangement With Legal & General Work?

Santander’s arrangement with Legal & General works by allowing Santander clients to apply for equity release in the form of a lifetime mortgage administrated by Legal & General.²

Santander clients may also apply for a Retirement Interest-Only mortgage, another type of later-life mortgage, through Legal & General.

What Costs Are Associated With Santander’s L&G Equity Release Product?

The costs associated with Santander’s L&G equity release product include legal costs and may include an application fee. 

You will also have to take the cost of interest into account when considering a lifetime mortgage.

How Do Interest Rates and Charges Compare?

Interest rates and charges can vary significantly between different financial products and institutions, so it is crucial to analyse and contrast these costs before making a decision.

When it comes to lifetime mortgages, rates can be fixed or variable, though most lifetime mortgages come with interest rates that are fixed for life. 

Remember

Equity release interest works on a compounding basis, which means any interest accrued will roll up and you will be charged interest on the original interest.

This can significantly increase the amount you end up owing.

There is another way

You may choose to repay all or some of the interest as it accumulates in order to keep your loan total as low as possible.

Santander calculates your interest daily and adds it to your loan every month, but ask your advisor about interest repayment options if that is something you would like to consider.³

How much will I pay?

Take a look at our handy summary if you would like to compare up-to-date equity release interest rates.

Are There Any Hidden Fees?

Any reputable institution, including Santander, should provide complete transparency regarding fees. 

Always read the terms and conditions thoroughly and seek financial advice if you are unsure.

Does Santander Offer Equity Release Alternatives?

Yes, Santander offers equity release alternatives. 

If you would like to access home equity but a lifetime mortgage will not meet your needs, you may like to consider one of these options. 

Santander’s alternatives include:

• Retirement Interest Only (RIO) Mortgages: Like lifetime mortgages, RIO mortgages are classified as later-life mortgages. Santander also offers clients this option through Santander.⁴ With a RIO mortgage, older homeowners are able to borrow against their home. Unlike lifetime mortgages, however, RIO mortgages require affordability checks and monthly interest payments. (The capital portion is repaid when the house is sold, typically after the homeowner passes away or moves into long-term care.)
• Remortgaging: Remortgaging involves switching your mortgage, either to a different deal with your current lender or a new deal with a different lender. This can potentially release some of the equity in the house if the property value has increased.⁵
• Changing your mortgage: If you have got an existing mortgage with Santander, you may be able to change the terms, which may include extending the repayment term.⁶
• Further Advances: If you are an existing Santander mortgage client, you may be able to borrow more money on your current deal. If this is an option you are considering, you will have to borrow at least an extra £5,000 for a minimum of five years.⁷
• A Green Improvements Loan: If you are an existing Santander mortgage client who would like to access some equity in order to make energy-efficient upgrades to your home, like installing a heat pump, insulation, or a solar system, you may want to consider Santander’s green additional loan option. If approved, you may be able to borrow between £5,000 and £50,000 on top of your existing mortgage.⁸ 
• Overdrafts and Credit Cards: For those looking for flexibility, Santander offers overdrafts and credit cards, although these may not be suitable for large long-term borrowings.
• Buy-to-Let Mortgages: For those homeowners looking to invest in rental properties, Santander provides buy-to-let mortgage options.⁹

Just like lifetime mortgages, these alternative options all come with their own advantages and drawbacks, so speak to a qualified financial advisor before making your final decision.

How Safe Is Santander?

Santander UK is a well-established bank regulated by the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA). 

This ensures they adhere to strict guidelines designed to protect consumers. 

Pros and Cons of Choosing Santander

The pros and cons of choosing Santander are, of course, very important to consider in order to make an informed decision.

What Are the Advantages of Using Santander?

The advantages of using Santander for equity release or alternatives to equity release include the bank’s established reputation and branch network.

Let us take a look at some more benefits:

• Established Reputation: Santander is one of the world's largest banks and has a strong presence in the UK, making it a well-known and trusted financial institution.
• Partnership with Legal & General: Santander clients benefit from the bank’s equity release arrangement with Legal & General, a well-known lifetime mortgage provider.¹⁰
• Wide Range of Products: From current accounts, savings accounts, mortgages to personal loans, Santander offers a broad spectrum of financial products and services.
• Online and Mobile Banking: Santander's digital banking platform allows customers to manage their accounts, make transactions, and access other services anytime, anywhere.
• Branch Network: Despite the trend towards online banking, Santander still maintains a good number of branches across the UK for those who prefer face-to-face banking.
• Security: Santander invests heavily in security measures to ensure customer data protection and safe online transactions.

What Are the Potential Pitfalls of Using Santander?

The potential pitfalls of using Santander include the fact that annual mortgage overpayments are capped at 10% for those on fixed rates.¹¹

Here are some other potential risks and downsides:

• Fees and Charges: Santander mortgages come with a £225 account fee payable on completion (or at the end of the mortgage term).¹² 
• Interest Rates: While Santander offers competitive rates on some products, it might not always have the best rates on the market. It is crucial to shop around.
• Customer Service Feedback: Like many large institutions, customer experiences can vary. Some customers might experience longer waiting times or service issues.
• Product Limitations: While Santander offers a wide variety of financial products, there may be specific types or features of products that are not available. For instance, as previously mentioned, Santander does not offer equity release directly to clients; instead, the bank will refer prospective borrowers to Legal & General.

Where Is Santander Located?

Santander UK has branches spread across many parts of the United Kingdom. 

To find the nearest branch, you can use the branch locator tool on the bank’s website.

What Do Customers Think of Santander?

What customers think of Santander varies depending on the products reviewed. 

While many appreciate the bank's wide range of services, convenient online banking, and branch network, some might have reservations about specific service aspects.¹³ 

It is a good idea to check independent review sites and perhaps even the feedback sections of app stores to get a comprehensive view of current customer sentiment. 

Always remember that experiences can be individual, so it is useful to assess feedback in light of your own requirements and preferences.

Santander’s FCA Details

Trading Names

• Santander Corporate and Commercial
• Santander Business
• Santander UK Plc
• Cahoot

FCA Permitted Services

• Banking
• Insurance
• Mortgages and home finance
• Consumer credit
• Pensions
• Investments

Regulators

Financial Conduct Authority

Registration Numbers

• FCA Ref Number: 106054
• Company Reg Number: 02294747
• FCA¹⁴
• Companies House¹⁵

How Can I Contact Santander?

You can contact them by filling in the online form or you can send a message using the ‘Chat with Us’ button.

How Did We Review Santander?

We reviewed Santander by employing a comprehensive and methodical approach to ensure a balanced and informed assessment. 

We delved into Santander's extensive range of mortgage products, comparing their offerings in terms of interest rates, terms and conditions, and unique selling points.

To gauge the quality of service and product satisfaction, we analysed customer reviews from various platforms, forums, and independent websites. 

We also considered feedback on customer service, ease of account management, and overall banking experience.

Our aim in this review was to provide readers with an unbiased, detailed, and holistic understanding of Santander's position in the UK banking sector. 

It is worth noting that the financial landscape is dynamic, and while our review is thorough, we always recommend potential customers do their research and consult with financial advisors tailored to their specific needs.

Common Questions

Conclusion

The combined expertise of a reputable high street bank and a leading insurance and financial services company offers a compelling package for homeowners looking to unlock the value in their property. 

The Santander and Legal & General lifetime mortgage product combines competitive interest rates with features that cater to the diverse needs of UK homeowners. 

As with all financial decisions, potential customers should weigh the benefits and risks, considering personal circumstances and long-term financial goals. 

When navigating the myriad of options available in the market, it is reassuring to know that with the Santander equity release, homeowners are backed by the combined strength and experience of two industry stalwarts.