23 February 2017
Picture this: A couple come into your office, both in their late 50’s and still working full time they want some advice on their options in retirement, their most pressing concern? their existing interest only Mortgage and the fact they have not got the capital to repay it in just 5 years time.
Previously the most likely and possibly the only solution would have been to sell up, but this categorically isn’t what your customers want, this is their family home, close to their jobs, close to their hearts. Downsizing may be an option but not for many years. They have not been irresponsible, their hope had been that rising house prices over the long term would mean they built up sufficient equity to be able to more than repay the mortgage, this hasn’t happened. What next?
This is set to become an all too common scenario with tens of thousands of older borrowers expected to be hit by a shortfall in their endowment policies or simply not having planned for what comes next. As an Adviser are you prepared?
Know your options, consider Hodge Lifetime’s 55+ residential interest only mortgage for customers age 55-95, an innovative proposition offering up to 60% LTV based on property value and affordability, with competitive rates from 2.99% and ERC’s from just 2 years.
Hodge believe there is no such this as a typical older borrower, as experts in later life lending they understand that each situation is unique and with their personal approach to underwriting they are able to look at income from employment through to retirement and most things in between.
Your customers could borrow the money they need to pay off their existing mortgage, over a set term from 5 years up to the youngest borrowers 95th birthday, repaying the interest only meaning payments remain affordable.
Maybe your customers want to pay off some of the capital? no problem, with the 55+ they are able to pay up to 10% per year from day 1 totally penalty free, with the flexibility to reduce the balance as and when they wish without being tied in.
At the end of the term they repay the capital from a specified repayment vehicle which can be downsizing, investments an endowment or sale of a second home, all they ask in the case of downsizing is that they have at least £150,000 remaining equity in the property.
For more information visit their website.