LIFETIME MORTGAGES
How will you spend your lifetime?
Liftetime mortgages, or equity release mortgages enable you to access the equity, or cash tied-up in your home if you are over the age of 55. Money can either be taken as a lump sum, in staged smaller amounts, or as a combination of both.
A lifetime mortgage is secured on your property. The property must be your main residence and you will retain ownership of it. You can choose to ring-fence some of the property’s value as an inheritance for family members, and whether you want to make repayments or allow interest to roll- up. The amount of the loan and any accrued interest is paid back when you die, or when you move into long-term care.
Questions our customers ask include:
What is the maximum percentage I can borrow?
This is usually 60% of the value of your property. However, how much can be released does depend on your age and the value of your property and the percentage typically increases according to your age.
What interest rate?
Interest rates must be fixed, or if you are on a variable rate, there must be an upper limit which is fixed for the life of the loan.
What happens to my property?
You continue to own the property and remain the legal owner until the last surviving owner dies or moves into long-term care (subject to meeting the lenders Terms and Conditions). At this point your estate will sell the property to pay-off the mortgage secured against the property. You are still responsible for the ongoing maintenance of the property.
What about repayments?
A lifetime mortgage has the option to make monthly interest payments which will reduce the amount of interest that accumulates over the term of the mortgage. You can stop these repayments at any time without penalty. These is also the option to make partial repayments with no Early Repayment Charge subject to the lender’s terms and conditions.
How is the money paid?
The money is released in small amounts or as a lump sum. The advantage of having smaller amounts is that you only pay interest on what has been withdrawn. However, if you choose this method it is important to make sure if a minimum withdrawal amount applies.
This is a Lifetime Mortgage. These are only applicable to those 55 and over, and it could affect eligibility to state means-tested benefits and the inheritance you may leave. To understand the features and risks, ask for a personalised illustration.
This service is offered by referral to a third party
