The lifetime mortgage is described as a form of an Equity Release plan which allows individuals to access a portion of equity which has accumulated in their homes. The lifetime mortgage legal and general and is the more popular form of Equity Release due to their flexibility and allows the homeowner to retain 100% ownership of their properties.
Eligibility For Lifetime Mortgages
When you own a property and you are 55 years of age or older, you become eligible for the application of a Lifetime Mortgage. For many homeowners, they find that paying into a property for the majority of their lifetime they are rich in assets, but they don’t have savings available for things the would like to do later on in life. If you require these funds, you should consider access to this wealth in a safe and flexible way without the need to sell your home. Lifetime Mortgages are all government regulated that come with various inbuilt-customer safeguards.
The Advantages Of Lifetime Mortgages
• Gives you control over your debt. Regardless of the amount you have chosen to release with your Lifetime Mortgage, you will never need to pay more than your properties value and you will never pass this debt onto your estate. If you decide to move and you do not want to repay this money you are able to transfer this plan to the next property.
• Some plans offer flexibility in the way of taking an amount of 10,000 pounds that is tax-free, leaving additional funds in a reserve for when it is needed.
• You maintain the ownership of your property with a Lifetime Mortgage
3 Lifetime Mortgage Types
There are 3 main Lifetime Mortgage types:
1. Roll-Up Lifetime Mortgage
This plan involves receiving a cash lump-sum that is free from monthly repayments. Interest will accumulate on the cash amount you have chosen to release. The lump-sum and interest are paid off when the home-owner of the deed has died or moves into long-term permanent care.
2. Drawdown Lifetime Mortgage
This plan works on the same principles of the Roll-Up Lifetime Mortgage, but you have the choice to release your money flexibly, when and as you require it. Interest does not accumulate on cash held in a reserve until you release it, which allows for a way to minimize interest charges.
3. Flexible Lifetime Mortgage
This plan allows for a way to contribute voluntary payments to your mortgage. A few of these plans come with monthly interest-payments, but you are not required to make a payment if you don’t want to. Similar to the Drawdown and Roll-up Lifetime Mortgage you will receive your lump-sum payment and retain 100% homeownership.