Mortgage & Money Management Ltd Claimed

A lifetime mortgage or Equity Release mortgage, is a financial product that allows homeowners aged 55 and older to release a portion of their home’s equity without the need for monthly repayments, with the loan typically repaid from the proceeds when the property is sold or upon the homeowner’s passing.

Allows homeowners, typically aged 55 and older, to borrow against the value of their home without monthly repayments, with the loan and accrued interest repaid from the sale of the property upon the homeowner’s death or move to long-term care. The funds to be released can used for most purposes.

To be eligible for a lifetime mortgage, individuals typically need to be aged 55 or older and own a property over £70,000.

The amount you can borrow will be determined by your current age & the value of your property. Typically, the older you are the more you can borrow. Most lenders will require you to release a minimum of £10,000.

Typical fees you will need to consider when arranging an Equity Release or Lifetime mortgage. Lender arrangement fee, mortgage valuation fee, solicitor fees & broker fee.

Equity release reduces the value of your estate, potentially leaving less for your heirs. With some equity release products, interest accumulates over the years, compounding the debt and potentially eroding the remaining equity in your home.

You can continue to live in your home for as long as you wish, maintaining your independence and comfort. The loan is not repaid until your passing or you move into long term care.

A lifetime mortgage is typically repaid when the homeowner passes away or moves into long-term care, with the loan and accrued interest settled from the proceeds of selling the property.

It is important to be aware that lenders may charge an early repayment charge, should you wish to repay your mortgage within a specified period. Lifetime mortgages are designed to last for life, so repaying early will possibly mean having to pay early repayment charges.

Receiving a lump sum from equity release may affect means-tested benefits or grants you are eligible for. It is important to check these before entering into a Equity Release Agreement.

Equity Release is a complex mortgage product & we strongly recommend that you seek independent advice before considering an Equity Release product.

The key difference between a lifetime mortgage and a home reversion plan is that a lifetime mortgage allows homeowners to borrow against their property’s value, with interest accruing, while retaining ownership, whereas a home reversion plan involves selling a portion or the entire property to a provider in exchange for a lump sum or regular payments, with no interest accruing but also giving up some or all ownership rights.