Short, straight answers to the things people ask before they pick up the phone.
Will I lose my home?
No. You continue to own it, and you have the right to stay there for life.
The loan is repaid when the property is eventually sold, which is normally when the last borrower dies or moves permanently into long term care. Nobody can move you out in the meantime.
Could I end up owing more than the house is worth?
No. Every plan we arrange carries a no negative equity guarantee. Whatever happens to house prices, and however long you live, neither you nor your family can ever owe more than the property sells for. Any shortfall belongs to the lender, not to your estate.
Am I old enough? Am I too old?
You need to be 55 or over for a lifetime mortgage. There is no upper age limit.
If there are two of you, it is assessed on the younger of you, which surprises most people.
Retirement interest only mortgages start at 50, and are assessed on affordability rather than age.
How much can I get?
It depends on your age and what your home is worth, not on your income.
Roughly, up to 28% of the value at 55, around 37% at 65, around 44% at 70, and up to 60% from 80 onwards. There is a minimum release of £10,000, and your home needs to be worth at least £70,000.
Any mortgage still outstanding has to be cleared out of the money released, so what reaches you is what is left after that.
What does it cost?
Our advice fee is a maximum of £1,495, and only if your case completes. If you decide not to go ahead, you pay us nothing.
There will also be lender and solicitor costs, which vary by case and are confirmed to you in writing before you commit.
The bigger cost is the interest, which rolls up over time unless you choose to pay it.
Do I have to make monthly payments?
Not on a standard lifetime mortgage. The interest is added to the balance instead.
But you can pay it if you want to, monthly or now and then, with no penalty. Pay the interest in full and the balance never grows. That option catches a lot of people by surprise.
Does it affect my inheritance?
Yes, and anyone who says otherwise is not being straight with you. The loan and the accumulated interest are repaid from the property sale, and what is left goes to your estate.
How much it affects things is largely within your control: take less, use drawdown so you only pay interest on what you have actually drawn, or pay some of the interest as you go.
Can I move house?
Usually yes. Most plans are portable to a new property, subject to the lender's terms.
If you move somewhere worth less, you may need to repay part of the loan to keep it within the lender's limits.
Will it affect my benefits?
It can. Releasing money can affect entitlement to means-tested benefits, because the money sitting in your account counts in a way that money in your walls does not.
This is worth checking properly before you proceed rather than afterwards, and it is part of the advice conversation.
What if I change my mind later?
Plans can be repaid early, though the lender may apply an early repayment charge. Those charges vary considerably, so it is worth understanding yours at the outset rather than assuming.
Do I need a solicitor?
Yes, and that is there to protect you. You will have your own independent legal advice before anything completes.
What if it turns out not to be right for me?
Then Craig will tell you.
That happens regularly, and there is no charge for finding out. Sometimes downsizing is the better answer. Sometimes a retirement interest only mortgage costs less. Sometimes there are benefits going unclaimed. Sometimes the right answer is to do nothing at all.
Not sure how any of this applies to your own circumstances? Craig is happy to talk it through, free and with no obligation.
Still not answered?
Ask Bruno on the site, or speak to Craig directly.
Book a call with Craig or call 0113 403 5584.
