We offer later life mortgages to help you meet your client's needs throughout their retirement.
A later life mortgage is a loan against the home for over 55s. Our later life mortgages are made up of Lifetime Mortgages and a Retirement Interest Only mortgage.
More people are using later life mortgages as part of their retirement planning. This isn’t surprising. A later life mortgage can support your clients’ retirement plans in a number of ways. It maybe used to provide a more comfortable retirement, or instead of taking income from pensions. This could mitigate income tax and reduce any tax payable on death.
A later life mortgage can help transfer money to children or grandchildren, perhaps to help buy a first home, or even pay off your client's existing mortgage. It can act as a backstop in case of unexpected expenses, or be used to fund care costs. It can even help if couples separate or divorce in later life.
Our Flexible Lifetime Mortgage provides a lump sum without the need to make any regular payments. Our Optional Payment Lifetime Mortgage gives your clients the flexibility to pay some or all of the monthly interest – but it’s not compulsory; while our Retirement Interest Only Mortgage is designed for clients who commit to pay all of the monthly interest.
|Our Lifetime Mortgages||Our Retirement Interest Only Mortgage|
|Minimum loan amount||£10,000||£10,000|
|Determined by your client's age and property value||Up to 60% of the value of your client's home, subject to an affordability assessment|
|Minimum property value considered||£70,000 or £100,000 for flats, maisonettes, ex-council, ex-housing association or ex-Ministry of Defence properties.||£70,000 or £100,000 for flats, maisonettes, ex-council, ex-housing association or ex-Ministry of Defence properties.|
|Is there an affordability assessment?||No||Yes|
|Is the loan secured against your client's home?||Yes||Yes|
|When do they have to repay the full amount of the loan?||The loan is usually repaid when your client dies or move out of their home into long-term care.||The loan is usually repaid when your client dies or move out of their home into long-term care.|
|Do they have to pay interest every month?||No - interest is charged on the loan amount plus any interest already added, so the amount owed will increase quickly over time. However, they can choose to pay off some or all of the monthly interest to prevent this.||Yes - the interest due is payable in full by them each month. As a last resort, their home may be repossessed if they fail to keep up repayments.|
|Is the interest rate fixed?||Yes. The interest rate is fixed for the life of the loan.||Yes. The interest rate is fixed for the life of the loan.|
|Actions||Our Lifetime Mortgages||Our Retirement Interest Only Mortgage|
A mortgage may affect means-tested state benefits, your client's tax position and any future inheritance.