An interest-only lifetime mortgage is a kind of equity release from the property, provided only to people over the age of 55.
The borrower only has to pay monthly interest at a fixed rate, while the principal amount borrowed remains the same. This amount need only be paid when the person should pass away or move to residential care by selling the property.
Source – @philhearing
This loan is meant for older people who have difficulty getting a standard residential mortgage. However, for you to be able to benefit from the mortgage, you will have to fulfil some eligibility criteria, which will be the decisive factor of how much money you can borrow.
This mortgage is meant to help older people unlock some part of the equity with simpler rules and regulations. For a start, you can search online for various equity release calculators from different financial services providers that will help you to calculate your risks and benefits for this kind of Lifetime Mortgage. Typically the initial filing fees (arrangement, legal advisor, completion, etc) could cost you around £3,000.
It’s always better to seek financial advice and understand all the ins and outs of an interest-based lifetime mortgage before deciding to get one.
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3. life insurance products attract terms and conditions. Price information contained within this website are for illustration purposes only. You will receive a full policy document upon application which will set out the terms, conditions and limitations of cover provided under the plan.
4. Your home may be at risk if you do not keep up repayments. Think carefully about securing debt against your home. When consolidating existing borrowing be aware that extending the term could increase the amount repaid.