Usually yes. It is one of the protections built into the product, and it is also one of the least understood.
The short answer
Lifetime mortgages are generally portable, which means you may be able to transfer your mortgage to a new property, subject to the lender's terms and the new property meeting its lending criteria.
Where it works, you do not have to repay the loan and start again, and you do not lose your rate. The plan moves with you.
This is one of the standards the Equity Release Council requires of its members' products, which is why it is on every plan we arrange rather than being a feature you have to hunt for.
The condition attached
The new property has to be acceptable to the lender.
That is not lenders being awkward, it is the same assessment they made on your current home. The property is their security, so it has to meet their criteria: standard construction, adequate value, an acceptable lease length if it is leasehold, and so on.
Most ordinary houses and flats are fine. The ones that need checking in advance are the same ones that need checking on any equity release plan: non-standard construction, retirement or age-restricted housing, properties with large amounts of land, annexes, and anything unusual.
If you are thinking of moving, ask before you offer on somewhere. A five minute conversation at that stage saves a great deal of difficulty later.
Moving to somewhere worth less
This is the part that catches people out, and it is worth being precise about.
If you downsize to a property worth less than your current one, the loan may become too large in proportion to the new home's value. Lenders work to a maximum loan to value, and that limit still applies after you move.
Where that happens, you may need to repay part of the loan to meet the lender's required loan to value limits.
The exact figure depends on your age at the time, the new property's value, and your lender's rules. It needs working out on your actual numbers rather than estimating.
Moving to somewhere worth more
Generally more straightforward. The loan is a smaller proportion of a bigger property, so the lender's limit is not the issue.
What it means in practice
- Wanting to move nearer family later does not rule out equity release now
- Nor does thinking you might downsize eventually
- What you should not do is assume it will be fine without checking, particularly if you have somewhere specific in mind
The mistake people make is not moving. It is finding a property, falling for it, and only then discovering the lender will not accept it.
Not sure how any of this applies to your own circumstances? Craig is happy to talk it through, free and with no obligation.
Before you start looking
Tell us you are thinking about it. We will look at your plan's specific terms, because portability conditions vary between lenders, and tell you what will and will not work before you spend a weekend at viewings.
That conversation costs nothing.
Book a call with Craig or call 0113 403 5584.
