Our equity release
Just For You Lifetime Mortgage
A lifetime mortgage is a loan secured against your home, designed to last for the rest of your life. We’ve designed our Just For You Lifetime Mortgage to allow an initial lump sum release with the added flexibility of a cash facility, from which you can release additional amounts in the future as and when needed. Our lifetime mortgage also provides an option to pay some or all of the monthly interest amount which could help reduce the overall cost of the loan amount.
To be eligible for our Just For You Lifetime Mortgage you must be aged 55 or over, or the youngest applicant must be aged 55 or over if you are borrowing jointly. You must also own your own home. The property – which must be your main residence – has to be in England, Wales, Scotland or Northern Ireland and worth at least £70,000. The maximum borrowing amount will be determined by a number of factors including your age and the value of the property.
The maximum amount available will be subject to an overriding maximum of £800,000 for properties in England, Scotland and Wales and £250,000 for Northern Ireland. The minimum amount you can borrow is £10,000, or £30,000 if you are making monthly payments.
Monthly payment option
The option to pay some or all of the monthly interest amount by direct debit must be chosen before the lifetime mortgage completes. The minimum payment is £25, up to 100% of the monthly interest amount.
There will be a reduction to the roll-up interest rate for customers who chose to pay some or all of the monthly interest amount. The level of reduction will vary on the percentage of interest being paid each month.
If a temporary break is needed from the monthly payments, we allow a payment holiday request of up to three months in any 12 month period following completion of the loan, subject to receiving one month’s notice. Any interest not paid during this period will be added to the overall borrowing and roll up on a compound basis.
If you want to stop making monthly payments altogether, this can be done at any time. The lifetime mortgage will switch to a full ‘roll up of interest’ basis and the interest rate applicable will increase. If the decision is made to stop making monthly payments, they cannot be restarted.
In regards to missed payments, after six months payments have been missed the lifetime mortgage will convert to a full ‘roll up of interest’ basis and the interest rate applicable will increase.
How is interest calculated?
The interest rate charged is set according to our interest rates at the time the initial advance is taken. The rate is fixed and so guaranteed not to change over the lifetime of the mortgage. If you are eligible for additional advances in the future, the interest rate for those advances will be set at that time and may be higher or lower than the rate on the initial advance. The interest rate will only change if you stop making monthly payments.
The interest rate charged will build up on a compound basis for any element of the loan that is not being interest serviced. This means interest will be charged on the amount of your lifetime mortgage as well as all the interest that has built up in previous months. The total mortgage, including this interest, is repaid when you (or both of you if borrowing jointly) die or move into permanent long-term care. This is normally done by selling the property.
When do I have to repay the lifetime mortgage?
The total amount owed and any accrued interest must be repaid within 12 months of you (or both of you if borrowing jointly) dying or moving into permanent long-term care. This means you do not have to make any monthly repayment, unless you choose the option to service some or all of the monthly interest amount.
Other things to be aware of:
Please bear in mind that taking a lifetime mortgage could affect:
- the amount you leave behind in your estate i.e. its value will be reduced,
- your entitlement to state benefits, and
- your tax position.
Valuation fees, legal fees, advice fees, set-up costs and other fees will apply. Please read our Lifetime Mortgage Guide.
How can I take a Just For You Lifetime Mortgage out?
We don’t sell our products directly, but you can purchase them through a financial adviser. You can find a professional financial adviser at unbiased.co.uk.
You can, however, still gather a bit more information whilst you’re here
If you’re not certain that you need a financial adviser just yet, that’s fine too: you can still use our free and easy-to-use Indicative Lifetime Mortgage Calculator. We stress it should only ever be used as a guide, but it is certainly a useful tool to help give you a feel for the kind of money a lifetime mortgage could enable you to release from your property.