Lifetime Mortgages

Exploring Your Retirement Options

Lifetime Mortgages

A lifetime mortgage is the most common type of equity release scheme and is usually secured against your main residence. This is a mortgage designed to run for the lifetime of the homeowner, in which the property remains 100 per cent in your name.
Unlike traditional mortgages, there are typically no month-to-month repayments to make, but most plans now have the facility to make voluntary repayments to help control the balance owed. There are many flexible options which can be included with lifetime mortgages

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Make repayments either on an ad-hoc or regular basis via voluntary or monthly repayments which can help control the future mortgage balance.

Drawdown Lifetime Mortgage’s create an initial cash reserve which will allow you to take tax-free cash withdrawals whenever you need them

Include innovative features such as downsizing protection, compassionate early repayment and Inheritance Protection Guarantee which all help add to your peace of mind – our advisers will be happy to explain all the differences, benefits and drawbacks of each feature

Your Right to Move Home

After you have taken out a lifetime mortgage there may come a time when you want to move. This could be for any number of reasons, such as an unforeseen change in your circumstance, or you may want to move closer to your family, for mobility reasons or to downsize.
Because the Equity Release Council approve all lifetime mortgages, you have the freedom to transfer your equity release plan to a new acceptable property, without incurring an early repayment charge: as long as the new property meets the lender’s terms and conditions.

Stay in Your Home

With equity release plans, you have the right to stay in your home for life, or until you move into permanent care. This protection will give you the peace of mind of knowing that your home cannot be repossessed and that you will never be left homeless.

Early Repayment Charges

As its name suggests, a lifetime mortgage is designed to be held for life – and not repaid early.
If you decide later on that you want to sell your house and pay off your lifetime mortgage you can, however lenders could make you pay an early redemption charge (ERC). There are two types of penalty: fixed and variable.
If repaying your plan early is likely, then make sure that you discuss this with your Retirement Income Solutions adviser. Penalties can vary and the right option for you is dependent on your circumstances.

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