What is a Lifetime Mortgage?
A lifetime mortgage allows you to release some of the equity in your home. The loan is secured against your property but, unlike a normal mortgage, you don’t have to make any regular repayments towards the loan during your lifetime. Interest accrues on the amount you borrow, and the total amount is repaid from the sale of the property when you die or go into long term care; until then, the home remains yours to live in.
Most lifetime mortgages can be released either as a single lump sum of money up front, or in instalments. If you take a lump sum, interest will be charged on the total loan amount from the date the funds are released. If, however, you opt to draw payments in regular instalments, you will only be charged interest on the sum released at that point in time, rather than the total mortgage amount.