MORTGAGE BROKER IN KENT, LONDON & SOUTH EAST
LIFETIME MORTGAGES
​A Lifetime mortgage is a type of equity release product designed for older homeowners. It allows them to borrow against the value of their home without having to make monthly repayments. The loan and accumulated interest are typically repaid from the sale of the property when the borrower dies or moves into long-term care.
What Is A Lifetime Mortgage?
A Lifetime mortgage is a type of equity release product designed for older homeowners. It allows them to borrow against the value of their home without having to make monthly repayments. The loan and accumulated interest are typically repaid from the sale of the property when the borrower dies or moves into long-term care.
Who Is A Lifetime Mortgage For?
Lifetime mortgages are typically suitable for:
Individuals looking to supplement retirement income or fund major expenses
People who want to remain in their homes while accessing their property wealth
What Are The Advantages Of Lifetime Mortgages?
No need for monthly repayments, ability to stay in your home
Option to receive a lump sum or regular payments, potential to ring-fence a portion of the property value for inheritance
Regulated by the Financial Conduct Authority (FCA), "No negative equity guarantee" ensures you never owe more than your home's value
What Are The Disadvantages Of Lifetime Mortgages?
Reduces the value of your estate and inheritance for beneficiaries
Interest compounds over time, potentially growing significantly
May affect eligibility for means-tested benefits
Early repayment charges can be substantial if you decide to repay the loan early, limits future options for moving or downsizing
Examples Of Where Lifetime Mortgages Can Be Used
The scenarios where a bridging loan can be used are varied but include:
Supplementing retirement income, funding home improvements or adaptations
Paying off an existing mortgage or debts
Helping family members (e.g., with house deposits or education costs)
Funding long-term care needs, purchasing a holiday home or funding travel, inheritance tax planning
It's crucial to note that Lifetime mortgages are a significant financial decision with long-term implications. They should be considered carefully, preferably with input from family members and independent financial advisers. The impact on tax position, benefits entitlement, and inheritance should all be thoroughly evaluated before proceeding with a Lifetime mortgage.
Process And Documentation Required For Lifetime Mortgages
Initial consultation with a qualified equity release adviser
Property valuation
Proof of age and identity
Details of any existing mortgages or secured loans
Information about the property (e.g., lease details for leasehold properties)
Confirmation of buildings insurance
Discussion and documentation of your long-term care plans
Involvement of a solicitor to provide independent legal advice
