Here’s What You Need to Know...
A lifetime mortgage is an appealing option for those aged 55 and above (or 50 for payment term lifetime mortgages) who want to unlock the equity in their home without having to sell or move.
At Whiteoak Mortgages, we’re here to help you make informed decisions about your home, finances, and future.
Let’s dive into the details of lifetime mortgages and explore whether it’s the right solution for you.
What is the Eligibility Criteria?
To qualify for a lifetime mortgage, you must:
• Be aged 50 or over.
• Own a home that meets the lender’s minimum requirements (typically with a minimum property value of around £70,000).
How Much Can I Borrow?
The amount you can borrow depends on your age and the value of your property.
Do I Have to Make Regular Repayments?
No, unless you choose to, there are no monthly repayments with a lifetime mortgage. Interest accrues over time, but the total owed will never exceed the value of your property.
When Do I Have to Repay the Full Loan Amount?
The loan is usually repaid when you move into long-term care or upon your passing, typically through the sale of your property.
Important Information
You should always think carefully before securing a loan against your property.
A lifetime mortgage will reduce the value of your estate and may affect your entitlement to means-tested benefits.
Clearing an existing mortgage with a lifetime mortgage may result in higher cost of borrowing.
We charge a fee for later life mortgage advice. The fee is up to £995.
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Want to Learn More?
Explore our Mortgages for Over 50s Guide—perfect for those approaching or enjoying retirement. It’s packed with answers to your questions and clear advice on the mortgage options available to you in later life.
A lifetime mortgage is a loan secured against your home, offering a way to unlock some of the tax-free equity tied up in your property.
The funds you release are yours to use as you wish. You can opt for a lump sum or take a smaller initial amount with the option of additional withdrawals later—this is called a drawdown.
You’ll continue to own your home, and with plans adhering to the Equity Release Council's standards, a no-negative-equity guarantee ensures you’ll never owe more than the value of your property. This prevents any debt from being passed on to your estate or family.
However, it’s important to note that a lifetime mortgage reduces the value of your estate and could affect eligibility for means-tested benefits. It may also impact the assets available to cover care costs in the future.
A lifetime mortgage lets you unlock tax-free cash from your property’s equity, determined by factors like your age, property value, and health. In most cases, there are no monthly repayments, depending on the plan you choose.
Your equity is the value of your home minus any outstanding mortgage or secured loans. While equity is often passed down as inheritance, many homeowners now use it to boost their retirement finances, gift a living inheritance, or fund essential expenses.
If you still have a mortgage, it must be cleared before accessing funds from a lifetime mortgage.
Important Note: Using a lifetime mortgage to repay an existing mortgage could lead to higher borrowing costs, so seeking professional advice is crucial
Payment Term Lifetime Mortgages (PTLM) are designed for those who wish to release equity from their home while making interest payments for a specified period.
Unlike traditional lifetime mortgages, where interest accrues throughout the life of the loan, PTLMs require mandatory interest payments for an agreed term. After this period, interest begins to accumulate, and the loan remains in place until you pass away or move into long-term care.
By paying the interest upfront during the agreed term, you can help retain more of your home’s value, reducing the impact on your estate.
Yes, a lifetime mortgage can reduce the inheritance you leave behind. The loan is repaid through the proceeds of your property’s sale, which could leave little or no inheritance for your family.
However, if you choose to pay some of the interest, you may be able to reduce the impact on your estate.
Our specialist advisers are here to help you explore your options and find the best solution for your circumstances.