Equity release lenders have driven down fixed rates to new lows, as competition in the sector hots up, said Moneyfacts.

The financial information provider said the average fixed rate for equity release deals has fallen to a record low of 5.63%, while lenders are expanding the number of options on offer to meet growing consumer demand.

More choice

The number of fixed equity release options has increased by a third in just two years, up from 52 options in 2015 to 82 today, the highest recorded figure in eight years.

And average fixed rates have dropped from 6.33% to 5.63% in the last year alone.

Sponsored

Rachel Springall, finance expert at Moneyfacts.co.uk, said: “Consumers these days may well be facing a retirement shortfall or have failed to set aside enough cash for potential care fees, so an equity release deal could give them a vital sum to enable them to enjoy their later years much more comfortably.

“Thanks to increased choice, consumers must now be more diligent when comparing deals, so seeking independent financial advice may prove vital. The lowest rate isn’t always the best option when it comes to picking the right equity release plan, and consumers may well prioritise how much they can receive in a lump sum instead.”