Supporting your customers
All you need to know to help your customers with a later life mortgage
Lifetime Mortgages - At a glance
- Lifetime Mortgages eligibility criteria. A customer aged 55 (50 for our Payment Term Lifetime Mortgage) or over, nearing the end of their interest only mortgage term could benefit from a lifetime mortgage. They need to live in the property.
- Lifetime mortgage products. There are three types of products, Payment Term Lifetime Mortgage where they have to pay the interest each month over a payment term, Optional Payment Lifetime Mortgage where they can choose to pay the interest each month for as long as they want, and Interest Roll Up Lifetime Mortgage where they don’t pay anything. Any unpaid interest is added to the loan.
- The amount they can borrow. The older they are, the more they can borrow. Use the calculator below to see how much your customer can borrow.
- The customer must get advice. Legal & General can help customers understand if a Legal & General Lifetime Mortgage is the right option for them. If Legal & General don't have the right product for your customer, they also have access to the whole lifetime mortgage market.
- Costs involved. Through the partnership between Santander and Legal & General, the advice the customer receives is free and they will not have to pay for a valuation. Some of our products have a £599 fee and the customer must meet the cost of their own legal advice. All customers will receive a cashback of 0.3%. (On a £100k loan this is £300).
- Interest rates. The rates available change frequently and the adviser will be able to give more information on this. Between 1 September 2023 and 31 August 2024, Santander paid an average of 6.51%. The higher the LTV, the higher the rate that is charged.
Equity release calculator
This calculator helps you see how much equity your customer could release with a lifetime mortgage, a loan secured against their home.
Before you start
Retirement Interest Only Mortgage - At a glance
- Use the money however they want. Your customer can spend it in all sorts of ways. If they give the money away, the recipient may need to pay inheritance tax in the future. There are few restrictions on how they spend the money. They can even pay off an existing mortgage.
- Interest is payable each month. The interest due is payable in full each month, so your customer always know how much they owe.
- There’s no fixed term. They don't have to repay the loan on a specific date. It’s repaid when the customer dies or when they move permanently into long-term care. At this point, the property is sold and the loan repaid. If they take out the loan with someone else, the property isn’t sold until both of them have either died or moved permanently into long-term care.
- The interest rate doesn’t vary. The interest rate is fixed throughout so there are no surprises. They pay the same amount every month.
- They can pay more to reduce how much they owe. If they want to pay off more than the interest due each month, they can make overpayments from time to time. So long as any overpayments don’t exceed our limits, there are no charges.
- They're portable. If your customer wants to move home in the future, they can port the loan to the new property.
Compare our later life mortgages
Our Lifetime Mortgages and Retirement Interest Only Mortgage may appear similar, but it's important to understand the differences between each product. We've pulled out some of the key points below.
Our Lifetime Mortgages | Our Retirement Interest Only Mortgage | |
|---|---|---|
Age | 50+ for our Payment Term Lifetime Mortgage 55+ for our Interest Roll Up and Optional Payment Lifetime Mortgages | 55+ |
Minimum loan amount | £10,000 | £10,000 |
Maximum loan amount | Determined by your client's age and property value. For our Payment Term Lifetime Mortgage an affordability assessment is also required. | 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? | Yes, for our Payment Term Lifetime Mortgage No, for our Interest Roll Up and Optional Payment Lifetime Mortgages | Yes |
Is the loan secured against my client's home? | Yes | Yes |
When do they have to repay the full amount of the loan? | The loan is usually repaid when they die or move out of their home into long-term care. | The loan is usually repaid when they die or move out of their home into long-term care. |
Do they have to pay interest every month? | No, for our Interest Roll Up and Optional Payment Lifetime Mortgages, the interest is charged on the loan amount plus any interest already added, so the amount owed will increase quickly over time. However, with our Optional Payment Lifetime Mortgage they can choose to pay off some or all of the monthly interest to prevent this. Yes, for our Payment Term Lifetime Mortgage, they have to pay the full interest monthly for their chosen payment term. As a last resort, their home may be repossessed if they fail to keep up repayments. | 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. |
A mortgage may affect means-tested benefits, your tax position and any future inheritance. | ||