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Lifetime mortgage
We could help you release
equity and remain in
your home
This is a lifetime mortgage. To understand the features and risks,
ask for a personalised illustration.
If you're over 60, our Lifetime Mortgage (equity release) could help you release the money tied up in your property, without you having to move or sell your home.
You can use the money for anything you want. However, you should think carefully about the way you use the money as the loan will be secured on your property.
However, releasing equity will reduce the value of your estate and affect any inheritance you might want to leave. The loan is secured against your home.
How the lifetime mortgage works
There are no regular repayments to make. Instead, interest is added to the loan - at an interest rate which is fixed for life. The whole loan amount is repaid when you die or move into long-term care, usually from the sale of the house.
This means interest will accrue faster when compared to a conventional mortgage.
Who can apply?
You can apply if you are aged 60 or over. You must own a property with two or more bedrooms, and the property must be:
- worth £70,000 or more
- your main residence
- located in England, Scotland or Wales
- freehold, leasehold or ownership (if it's in Scotland)
Please note: this product could affect your entitlement to state benefits. Please read legal information and rates and charges .
- Flexibility - get your money as a lump sum, regular monthly amounts or a mixture of both
- No regular repayments - so you've got no extra outgoings but remember the interest on your mortgage is compounded and so accrues faster than a conventional mortgage
- Own your home - we will never ask you to leave your home, as long as the mortgage conditions have been met
- No debt for your estate - even if house prices fall, we guarantee your estate will not have to pay back more than your home is worth (as long as the mortgage conditions have been met)
- Leave an inheritance - you can set aside a percentage of your property's value to leave in your will. As long as the mortgage conditions have been met, this amount won't be touched when the mortgage is repaid.
Please note: this product could affect your entitlement to state benefits. Please read legal information and rates and charges .
Lifetime mortgage interest rate
| Interest rate | Overall cost for comparison |
|---|---|
| 6.79% fixed for the life of the mortgage | 7.2% APR (lump sum) |
| 7.4% APR (regular monthly amounts) | |
| 7.3% APR(mix of both) |
Setting up your Lifetime Mortgage
| Fee | What are you paying for? | Amount |
|---|---|---|
| Application fee | The administration involved in setting up the mortgage and reserving your money at the fixed rate of interest. | £599 |
| CHAPS fee (lump sum option only) | The cost of transferring the money to you when your Lifetime Mortgage is completed. | £30 |
| Valuation fee | An independent valuation of your property. | This is dependent on the property value. |
| Valuation administration fee | The administration involved in carrying out the valuation. | £75 |
| Legal fees | You'll pay these fees direct to your solicitor for the work they do. Your solicitor will need to carry out the necessary legal checks so we can use your property as security. You must receive independent legal advice before taking out the Lifetime Mortgage. | You'll need to agree these with your solicitor. |
Repaying the mortgage
| Fee | What are you paying for? | Amount |
|---|---|---|
| Early repayment charge | Repaying the mortgage in full within the first 10 years. This is calculated as a percentage of the outstanding balance. | Yrs 1-3 5% Yrs 4-6 4% Yrs 7-8 3% Yrs 9-10 2% |
| Security release fee | The administration charge for releasing our security on the property, if you repay the mortgage in full. | £225 |
| These fees won't apply if you only partly repay the mortgage or if the mortgage is repaid in full because you die or have to move into long-term care. | ||
Other charges or costs may apply.
Applicants must be aged 60 or over.
The property to be mortgaged must be worth at least £70,000. There's no maximum property value.
Maximum borrowing limits apply - these will depend on your age (or the age of the youngest applicant if a joint mortgage) and the value of your property.
Application fee
You can pay the application fee upfront or have it added to the loan, as long as this doesn't take you over the maximum amount we can lend you. If you're already borrowing the maximum allowed and taking the money as a lump sum payment, the fee can be taken from this payment. See the table below for details of the other fees for setting up the Lifetime Mortgage.
Early repayment charge
This will apply if you repay the Lifetime Mortgage in full within the first 10 years. We'll calculate the charge as a percentage of the outstanding balance - see the table below for full details. The charge won't apply if you partly repay the mortgage, or if the mortgage is repaid in full because you die or have to move into long-term care.
Interest
We calculate this daily and apply it monthly. Because there are no monthly repayments, interest on the amount you borrow will build up quicker than with a conventional mortgage.
Interest rate
This is fixed for the life of the Lifetime Mortgage and won't be affected by changes in the Bank of England base rate.
Legal fees
We recommend you take independent legal advice from a solicitor. You will be responsible for paying any legal costs. You can choose your own legal adviser or use a member of The National Solicitor's Network, which has a panel of solicitors who deal with lifetime mortgages.
Loan
The Lifetime Mortgage is a loan secured against your home.
Valuation fee
You will need to pay the valuation fee upfront. The amount of this fee will depend upon the property value.