To help find out how compounding interest rates affect your client's mortgage over time. We've developed two examples to illustrate the effects of compounding interest, and how interest repayments can be managed on our Optional Payment Lifetime Mortgage.


Example one

Based on a loan amount of £100,000 the table illustrates how compounding interest can be managed by making differing monthly payments over a 15-year period.

OPLM interest graph



Example two

Below based on a loan amount of £100,000 the table illustrates the total owed and paid managing the effect of compounding interest.

OPLM interest graph



Lifetime Mortgage calculator

Our Lifetime Mortgage calculator helps financial advisers to:

  • Show your clients how much they may be able to release from their home.
  • Demonstrate examples for both taking the maximum available as an initial advance or taking a smaller initial amount where the remainder can be drawn on in the future.
  • Illustrate the effect of our inheritance protection option on the total loan amount available.
  • Explore the impact of house price inflation.
  • Highlight how the interest on their loan increases over time.
  • Create a summary of your client's choices and possible results.

The calculator results are examples only. A lifetime mortgage is a loan secured on your client’s home. It will reduce the value of your client's estate but servicing the interest can slow or stop the growth of the loan over time and may affect their entitlement to means tested state benefits.

Our Payment Term Lifetime Mortgage will be due on the calculator shortly.