Lifetime Mortgages

A lifetime mortgage is a loan secured against your home which does not need to be repaid until you die or go into long-term care. It’s a type of equity release product for homeowners aged over 55.

Unlike a regular mortgage, you don’t have to make any monthly repayments with a lifetime mortgage and the interest builds up on your loan each year. Interest is charged on the total borrowing plus any interest previously added, which quickly increases the amount you owe (compound interest). However, some providers do allow you to make interest payments if you wish.

You retain ownership of the property and the interest rate is usually fixed for the duration of the lifetime mortgage.

The equity that you release is tax-free and can be used for any purpose. Typical reasons include:

• adapt your home
• renovate or refurbish your home
• top up retirement income
• pay off private medical bills or receive ongoing care at hom.
• help children / grandchildren with a house deposit or wedding
• manage your estate, wealth and tax planning
• pay off an outstanding mortgage including a shortfall on an interest only mortgage.
• fund leisure interests, a new car or holiday.

The loan and interest are repaid in full, usually from the sale of your home when you (and your partner, if you have a joint lifetime mortgage) pass away or go into long term care.