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What is a Lifetime Mortgage?

Article | Feb 2024

A Lifetime Mortgage could be a great way to make the most out of your home and enjoy your later years. By using this equity release product, you could access some of the wealth in your home without having to sell it or move out. You can use the tax-free cash in a variety of ways, such as giving your loved ones a helping hand, treating yourself to a dream holiday, or improving your quality of life.

You will have the flexibility of deciding how and when to make payments, whether that be choosing to make optional payments in your lifetime or allowing the interest to accumulate until the end of the mortgage. Either way, you will never owe more than your home is worth, thanks to the no-negative-equity guarantee.

To find out if a Lifetime Mortgage is right for you, you can book a free consultation with one of our friendly advisers. They will explain all the options available to you, including the Lump Sum and Drawdown Lifetime Mortgage products. They will also compare a Lifetime Mortgage with other financial solutions, such as a Retirement Interest-Only Mortgage, a conventional mortgage, or doing nothing. They will give you a clear and honest recommendation based on your personal situation.

Don’t miss this opportunity to unlock the potential of your home and live the life you deserve. Contact us at 0800 048 5807 today for a no-obligation chat and see how a Lifetime Mortgage can make a difference for you. Or continue reading and discover more about this flexible financial solution.

How does a Lifetime Mortgage work?

If you are over the age of 55 and a homeowner, you will be able to discover if a Lifetime Mortgage is right for you. There will be two main options to consider when opting for a Lifetime Mortgage product.

The first option available is the Lump Sum Lifetime Mortgage. With this equity release product, you will be choosing to release the equity available to you from the value of your home in a tax-free lump sum. The interest rate for the Lump Sum Lifetime Mortgage is fixed for life and added to the full total borrowed over your lifetime.

Another route to a Lifetime Mortgage is the drawdown option. Instead of releasing all the available cash in a single lump sum, you can takeout a smaller amount that is suited to your needs at the time. Once you have taken out the smaller amount, you then place the rest of the money into an interest-free reserve. To withdraw further funds from the free reserve in the future, you can contact your lender and start the process.

To determine how much you can release with a Lifetime Mortgage, you will need to supply some information about your circumstances. This information will include the age of the youngest homeowner in the property and an estimation of its value. The older the youngest homeowner is, the more equity you will be able to release.

Our free equity release calculator will help you estimate how much equity you can release from your home. Once all the information has been provided, we will provide you with a maximum and minimum figure that you could release with a Lifetime Mortgage.

Is a Lifetime Mortgage right for you?

There are many benefits to opting for a Lifetime Mortgage. The money you release from your home is tax-free and could help you to fund early inheritance gifts or perhaps pay for a dream holiday.

In addition, you have the freedom of choosing whether to make payments during your lifetime or not. When the last homeowner dies or enters long-term care the full amount is paid back including any interest.

If you book an appointment in with one of our advisers, they will ensure that all your options are discussed. This will involve evaluating both the Lump Sum and Drawdown Lifetime Mortgage products.

Your adviser will also talk through the other financial options available to you before providing a clear recommendation. This could include a Lifetime Mortgage, a Retirement Interest-Only Mortgage, conventional mortgage, or in some cases even choosing to do nothing. The recommendation will depend on your personal circumstances.

Take the next step to a Lifetime Mortgage

A Lifetime Mortgage could be the perfect flexible solution for you. If you're interested in discovering more about how it works and how it could help you to achieve your goals, use our free equity release calculator today. By completing a calculation, you will also be contacted by our UK-based Information Team, who can answer your questions and book you in for a free initial advice appointment.

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