Lifetime Mortgages
You will normally have to be aged 65 years and
be retired (not in receipt of earned income)
You can opt for a scheme where you do pay interest monthly, with
only the capital (and attendant charges) being repaid on death.
If you do not have a fixed rate loan and have opted to pay interest
monthly, any increase in interest rates could mean that this becomes
unaffordable.
A retirement home plan mortgage is a lifetime
mortgage scheme conducted on an interest only basis. These plans are
only normally available to applicants over the age of 65, although
there is discretion for applicants under 65 in circumstances where
they are retired with no earned income.
Funds can be used for any purpose. You can
borrow up to 75% of the value of your property.
How it works
This is a lifetime
mortgage where the mortgage balance never decreases. It must be
repaid at the end of the mortgage term or when the property is sold,
if this is earlier. Once the mortgage is repaid, any surplus sale
proceeds belong to you or your estate.
If you already
have a mortgage you may be able to transfer it to a Retirement Home
Plan and take advantage of a lower, interest only, monthly payment.
Monthly repayments
You need enough income to meet your monthly repayments and other associated home
ownership costs.
To use a
retirement home plan for home purchase or home improvements,
Department for Work and Pensions benefits may be suitable income.
Terms
-
Minimum age: applicants must normally be age 65 or over
-
Maximum term: 40 years
-
Maximum loan: 75% of property value. Other restrictions may
apply depending on the product selected
-
Basis: single or joint life, fixed or variable rate interest
only mortgage
-
Interest rates: rates will depend on the individual
circumstances of the applicant
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