When you are looking to fund your retirement or access funds in a time of need, without sacrificing your quality of life, there are financial options. One of the most popular choices these days is equity release. There are a number of options and plans can often be adjusted to accommodate the needs of the homeowner. Lifetime mortgages are one popular option and, just like any other plan, it’s important to do your fair share of research before making any decisions.
Different financial options are suitable for different people depending on their needs and overall financial situation. The general minimum age for anyone interested in applying for a lifetime mortgage is between 55 and 60. Not only will your age determine your eligibility but it will also be taken into consideration when calculating how much you may borrow. At the age of 65, you can normally release approximately 20 to 25% of the value of your home. The older you get, the higher this percentage becomes and it can reach as high as 50%.
Another important point to keep in mind is that companies usually implement a minimum loan amount. The minimum usually ranges from £10,000 to £20,000 depending on the lender’s policies and how the homeowner measures up to various criteria. Lenders also usually require that the applicant’s home has a certain minimum value. Again, this minimum varies based on several factors and can be anything from £70,000 to £100,000.
Homeowners who meet the minimum age requirement, as well as the additional criteria, can enjoy the benefits of a lifetime mortgage. One of the main advantages is that homeowners will not need to move out of their existing home. They can continue living in the very house they love without worrying about making any payments. Just like most financial agreements, it’s important to ask your adviser about their cancellation policy. Should you decide to pay off your lifetime mortgage ahead of time, you might be liable for certain fees, and it’s important to consider this regardless of your plans for the future.