A lifetime mortgage is a type of equity release plan available in the UK. It allows a homeowner to release equity from their property while still remaining in their own home. For many people, who find themselves low on capital in their older years, this can be a viable option that allows them to avoid the upset of moving and allows them to remain in their homes in their later years - for others it can allow them to fund the retirement trip of a lifetime or help their children onto the property ladder.
In order to take up a lifetime mortgage you must own your own home or have only a small mortgage left to pay. Most providers require that you be at least fifty-five years old and that the value of your home is seventy thousand pounds or above. Certain property such as static homes, houseboats and farms may not be considered suitable for equity release as it must be shown that the property can be readily sold on the open-market at a future date.
The amount you can release from your home through a lifetime mortgage will depend on your age and the value of your property. Other aspects such as current or previous health conditions may also be taken into consideration. Typically, the older you are the greater the sum you may be able to release from your property.
Although it is called a "mortgage" there are no monthly repayments associated with a lifetime mortgage. The interest is instead ‘rolled up’ and is payable along with the sum borrowed only after the property is sold. With this type of plan you retain full ownership of the property until you pass away or until you move into full-time residential care. If you take out a plan with your husband, wife or partner then the plan only comes to an end after the last person has left the property. When the plan comes to an end the property is sold by your estate and the loan repaid.
When releasing equity using a lifetime mortgage you can choose to do so either by receiving a lump sum or by taking smaller payments up to an agreed limit. Some lenders also offer the option of repaying the interest over the loan period so only the amount of equity released has to be repaid at the end of the plan.
You do not have to release all the equity in your home through a lifestyle mortgage and that which remains can be bequeathed after your death through your will in the usual way.
If you would like to find out more about lifetime mortgages you can speak to one of our trained advisors by calling 0207 158 0881. You can also request a call back by completing the form on the “contact us” section of this website. You can also find out how much equity you may be able to release using our free equity release calculator.
For piece of mind, all equity release providers in the UK are regulated the Financial Conduct Authority (FCA).
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Money Release Limited is registered in England No. 09332792. Registered office: Harwood House, 43 Harwood Road, London, SW6 4QP.
Money Release Limited is authorised and regulated by the Financial Conduct Authority. FCA registered number 679004.
Equity release is not right for everyone and may involve a lifetime mortgage or home reversion plan. To understand the features and risks ask for a personalised illustration.
The content of this website is provided for information purposes only. Nothing within this website should be construed as investment advice and should not be relied upon.
The information contained within this website was obtained from sources believed to be reliable but no guarantee is given to its accuracy and completeness. Money Release Limited is under no obligation to update, modify or amend the information and it does not accept any liability for any loss or damage, however caused, arising from any errors, omissions, or reliance on any information or views contained in this website.