Lifetime Mortgages: A quick guide
- kristiankolb
- May 14
- 3 min read
The following post is designed to provide insight and information for people who are interested in learning more about what Lifetime Mortgages are and how they work.
What is a Lifetime Mortgage?
Lifetime Mortgages are designed to meet the needs of older borrowers who will typically be aged 55 and over. Lifetime mortgages fall under the umbrella of Equity Release which is what some people will know them as.
They allow you to borrow money from the equity in your home without having to sell.
Unlike a conventional mortgage there is no set end date and no monthly loan repayments. Instead, interest is added to the loan and rolled up. The loan and interest are repaid from the sale of the house when you die or enter long term care.
How do they work?
Just like an ordinary mortgage the lender will secure their loan against your property.
The amount they lend and the rate they charge will be determined by your age and the value of your property and the size of the loan you take out.
Does it matter how much I earn?
Not normally. Because there are no monthly repayments to make your income is not important. This can be especially useful if you are looking to repay an existing mortgage to free up additional monthly income.
I have an unusual property. Will I still qualify for a Lifetime Mortgage?
Lifetime mortgage lenders will place a much greater emphasis on the suitability of your property than a conventional mortgage lender. Different lenders will have different criteria and some may lend on properties that other lenders won’t. That’s why it’s important to speak to an adviser who offers advice from a comprehensive range of lenders.
What can I borrow money for?
A whole range of things. For example, to repay an existing mortgage, home improvements, a holiday or to help your children get on the housing ladder.
Are Lifetime Mortgages always a good idea?
No – for example taking out a Lifetime Mortgage might affect your entitlement to state benefits. That’s why it’s important that you seek advice from a qualified adviser who will make sure to consider the alternatives to and the consequences of taking out a Lifetime Mortgage.
Does Mayfield Mortgages offer advice in Lifetime Mortgages?
Yes. I am authorised and qualified to offer advice on Lifetime Mortgages.
I offer advice from a comprehensive range of lenders.
What are the costs associated with a Lifetime Mortgage?
Costs can vary but are typically as follows:
Broker Fee - I charge a flat fee of £495; some Brokers will charge a percentage of the loan which can work out a lot more.
Lender Product Fee - can normally be added to the loan or deducted from the advance.
Valuation Fee - some lenders will offer this for free; other will charge on application.
Solicitors Fee - typically between £1-£1500 depending on the work involved and is normally payable when the loan completes.
Will I have to pay a fee for an initial consultation?
No. The initial consultation is free and there is no obligation to take things any further.
Do you offer face to face appointments?
Yes. My preference is to meet clients face to face to discuss Lifetime Mortgages. I am happy to arrange home or office appointments to suit your requirements.
I would like someone else to attend the meeting with me - is this possible?
Of course. It’s a good idea to discuss something like a Lifetime Mortgage with your family and it’s perfectly fine for them to attend the meetings and have copies of paperwork provided.
How can I make an appointment?
Please use the Contact Us link to make an appointment or telephone on 0118 991 8704
I am an accountant/solicitor/estate agent and I have clients who may benefit from a Lifetime Mortgage - can I refer them to you?
Please contact me directly and we can discuss the process of you becoming an introducer to Mayfield Mortgages as well as the benefits of doing so.
Where can I find more information?
Money Helper brings together the support and services of three government-backed financial guidance providers: the Money Advice Service, the Pensions Advisory Service and Pension Wise.
The Equity Release Council represents the equity release sector and exists to promote high standards of conduct and practice in the provision of and advice on equity release which have consumer safeguards at its heart.
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