What is a lifetime mortgage?
A lifetime mortgage is one of the most popular forms of equity release because it allows you to free up part of the value of your home without the risk of losing it. You retain full ownership of your home, the equity that is released is tax-free, and the money can be taken in one big lump. Consequently, a lifetime mortgage would be particularly beneficial if you’re looking to raise a substantial amount of cash without having to worry about repayments. Interest is added over your lifetime, accruing at a fixed or variable rate. The loan plus the interest is eventually repaid when your home is sold. This can be when you or your partner die or move into long-term care. In the UK, you can usually release up to half the value of your home with a lifetime mortgage, though that will depend on your age and the value of your home. An independent equity release specialist will be able to advise you more thoroughly on this. Some advantages of a Lifetime Mortgage: – You retain full ownership of you
A lifetime mortgage is not that different from the standard mortgage you probably took out when you originally bought your home. It is a loan secured against the value of your property on which interest is paid. However, unlike a standard mortgage, there are normally no monthly instalments to pay (although some providers may require you to pay the interest on the loan). However, with both equity release products from LV=, the interest is added to the loan to be repaid on the death of the borrower or if the borrower goes into permanent residential long term care. The loan is usually repaid from the proceeds of the sale of the property.
