Lifetime Mortgage UK

Lifetime Mortgage UK

Lifetime mortgage UK refers to a form of equity release mortgage within the UK, which enables a borrower admission to capital that only needs to be repaid at the end of the arrangement. To qualify for a lifetime mortgage UK product, an individual must be over the age of 55. Our dedicated advisers are devoted to seeking the most suitable and practical lifetime mortgage UK product for each client.

Key indicators signifying the end of the lifetime mortgage UK arrangement include   the death of the borrower, or if the borrower occupies residency in care home indefinitely. Under some circumstances, the borrower may be eligible to move to another home if he/she wishes, but this result in the end of the agreement and the remaining debt must be repaid to the lifetime mortgage UK provider in full. There are three by-products associated with a lifetime mortgage UK, which are available to clients seeking an equity release plan. These are interest only schemes, interest rollover schemes and home income plans.

An interest only scheme does not necessitate the borrower to repay the sum of the mortgage until the end of the agreement; however a monthly payment of interest is still required by the lifetime mortgage UK provider.

Interest only schemes provide advantages to younger clients, as the money generated from the arrangement may be used to repay previous loans. Nevertheless, varying interest rates may escalate the amount of the total debt, which may leave the estate of the borrower in a financially weak position. In addition, increases in income or capital will affect the borrower’s eligibility to apply for state benefits. We strive to provide our clients with precise information on each lifetime mortgage UK scheme, as well as proposing which scheme is the most efficient for each client’s financial requirements.

Interest rollover lifetime mortgages work by allowing the borrower to repay interest along with the overall loan at the end of the arrangement. Interest may be still free to vary and is calculated every month. This will result in an enlarged debt by the end of the contract.

Benefits of an interest rollover scheme include the borrower being guaranteed occupancy, on top of the borrower not needing to make any payments to the lifetime mortgage UK provider for the remainder of their life. However, there are many risks which accompany interest rollover lifetime mortgage UK schemes. Firstly, interest can soar rapidly if interest rates are variable, resulting in an increased mortgage debt by the end of the contract. This will reduce the equity remaining in the borrower’s estate, leaving less for the borrower’s inheritors to benefit from.

Home income plans require the borrower to make mortgage and interest payments on a monthly basis to the provider. They may benefit from using their newly found cash to purchase an annuity, which will supply them with a lifetime income. The annuity can be used to contribute to monthly mortgage repayments.

There are many benefits, as well as limitations associated with a lifetime mortgage UK deal. Individuals must be aware that some lifetime mortgages serve more benefit than others, depending on each individual’s personal and financial requirements. With the help of our specialist advisers, we will work hand in hand with each client to find the most suitable lifetime mortgage UK, in relation to their individual ambitions and needs.

Seeking advice on lifetime mortgage UK products? Contact our advisers now.

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This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.

CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL YOUR HOME OR YOU WANT YOUR FAMILY TO INHERIT IT. IF YOU ARE IN ANY DOUBT, SEEK INDEPENDENT ADVICE.