Harrogate has a higher proportion of older homeowners in substantial period property than most of Yorkshire, which changes the questions people ask.
Here, the conversation is rarely "can I afford to stay". It is more often about what to do with capital that has been sitting in a house for thirty years while income has not kept pace with it.
Being asset rich and income light
It is a common position and an uncomfortable one. A large house, considerable equity, and a retirement income that will not support conventional borrowing.
Ordinary lending is assessed on income. That is the wall people hit.
A lifetime mortgage is not assessed on income. It is based on your age and your property's value, which is precisely why it reaches people that standard lending has stopped saying yes to. If your wealth is in the walls rather than the bank, that is the relevant difference.
What the local housing means in practice
Larger period property, the Victorian and Edwardian villas through the Duchy, Harlow Hill and around the Stray, tends to mean a higher property value, and a higher property value means more of the maximum is available to you.
That cuts both ways, and it is worth saying plainly: the maximum is not a target. Interest on a lifetime mortgage compounds, so the bigger the sum and the longer it runs, the more it grows. Our advice is to take what you need rather than what you could have.
For people with substantial equity, drawdown is often the more sensible route. You take an initial amount now, leave the rest in an agreed reserve, and only pay interest on what you have actually taken.
Paying the interest is also worth a proper look here. If your income comfortably covers a monthly interest payment, the balance need not grow at all. Modern plans allow that, monthly or ad hoc, with no penalty.
Larger plots and outbuildings are common in and around Harrogate. Large acreage and annexes are not ruled out, but they go to a lender for a decision rather than through a standard assessment, so they are worth raising early.
A retirement interest only mortgage may suit you better
Where there is reliable retirement income, a RIO is often the cheaper answer over time, because you pay the interest monthly and the balance stays where it is.
It is assessed on affordability rather than age, from 50 upwards. Because payments are required, your home is at risk of repossession if you do not keep them up, which is the trade against the lower long term cost.
Craig advises on both and will tell you which fits.
The basics
- 55 or over for a lifetime mortgage, 50 or over for a RIO
- Property worth at least £70,000
- Minimum release £10,000, no upper age limit
- Joint applications assessed on the younger applicant
Roughly up to 28% of value at 55, around 37% at 65, around 44% at 70, up to 60% from 80.
Not sure how any of this applies to your own circumstances? Craig is happy to talk it through, free and with no obligation.
Talking to us
Phone, video or face to face. The first conversation is free, and our advice fee is a maximum of £1,495, payable only on completion.
Book a call with Craig or call 0113 403 5584.
