13 March 2018

Clearing an interest-only mortgage

Nigel and Jenny have lived in their beautiful cottage for nearly 20 years. They had an interest-only mortgage, but as the end of the loan term approached, they still had a substantial amount of the mortgage to repay.

It looked like they would have to sell their family home to repay the outstanding mortgage, which would have meant relocating and downsizing to a smaller home. It was something that caused sleepless nights and worry for them both.

But then they found out about lifetime mortgages. They sought advice from a lifetime mortgage adviser, and discussed it with their family before deciding that taking out a Legal & General Lifetime Mortgage would provide them with an alternative solution to their problem.

Their Legal & General Lifetime Mortgage has enabled them to repay their outstanding interest only mortgage completely and allowed them to continue living in the home and location that they love, surrounded by friends and family.

In Jenny’s words: “Since we have the lifetime mortgage we feel relaxed. We are not worried anymore, we feel safe.”

Nigel and Jenny clearing interest-only mortgage

Nigel and Jenny clearing interest-only mortgage video

Nigel and Jenny talk about clearing their interest-only mortgage with our Lifetime Mortgage.

A lifetime mortgage is a loan secured against your client's home. Unlike a traditional mortgage, they don’t have to make any monthly payments. They should consider other ways to borrow money which might be more cost effective. The loan is repaid from the sale of their home when the last surviving applicant dies or moves into long term care.

It’s important to know that we charge interest on the total loan plus any interest already charged. That means the amount your client owes grows quickly, and reduces the equity left in their property and the value of any inheritance. It could also affect any entitlement to State Benefits.

The property must be maintained in good repair and condition.

You may wish to use customer testimonials when meeting with your clients to help them see how our Lifetime Mortgage have helped others.