Rolled-Up Interest Calculator
See how a lifetime mortgage balance grows when interest is rolled up rather than paid, and what equity remains as the property value changes.
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Equity release products commonly roll interest up rather than requiring payments, so the balance compounds untouched for as long as the borrower lives in the property. At typical rates a balance roughly doubles every eleven or twelve years, which is what makes the eventual figure so much larger than people expect.
Whether that matters depends on what the money achieves and whether an inheritance is a priority. The arithmetic is not an argument against the product — it is the information needed to decide, and it should be seen before signing rather than after.
The calculation
Balance owed = amount released × (1 + rate)^years, with nothing repaid along the way. The property value is compounded separately at its own growth rate, and the equity remaining is the difference.
Worked example
Releasing 60,000 at 6.5% for fifteen years leaves 154,310 owed — 94,310 of interest on a 60,000 advance. A 350,000 property growing 3% a year is worth 545,288 by then, so 390,978 of equity remains and the debt is 28.3% of the property.
Growth versus the rate is what decides it
Where the interest rate exceeds property growth, the debt takes an increasing share of the property every year. At 6.5% against 3% growth the gap is 3.5 points annually, which compounds. Test the calculation at zero growth to see the downside case.
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Create your free property pageFrequently asked questions
How quickly does the balance double?
At 6.5% it roughly doubles every eleven years, and at 8% every nine. The rule of 72 gives a close estimate: divide 72 by the rate to get the approximate doubling period in years.
Can I owe more than the property is worth?
Many products carry a no-negative-equity guarantee that prevents it, but this is a product feature rather than a universal rule. Confirm in writing whether it applies, since without it the shortfall can fall on an estate.
Can I reduce the balance by making payments?
Many modern products allow voluntary payments up to an annual limit without penalty, and even small regular payments substantially change the outcome. Ask about this specifically, because it is often available and rarely volunteered.
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