Interest Only Lifetime Mortgages: A Complete 2024 Guide
The options with lifetime mortgages has changed significantly in 2024 due to the launch of new interest only lifetime mortgages as the later life mortgage market grows.
Request a free review with our experts at Later Life Finance.
Updated February 2024 -Author Paul Murphy
Later Life Finance Limited.
Table of Contents
What is an interest only lifetime mortgage?
In 2024 the range of equity release interest only lifetime mortgages available in the later life mortgage industry has stepped up a gear with more plans becoming available.
These new mortgages have been developed in line with increased demand from over 50’s homeowners, especially where remortgaging from an existing interest only mortgage with a strong desire to continuing servicing the interest payments each month.
Later Life Finance have being arranging mortgages for 10 years and have seen demand continue to grow for more flexibility in later life.
If you’re considering releasing some of the equity in your home, knowing how much money you can borrow with a lifetime mortgage broker is one important factor, but understanding the most cost effective way to arrange the plan is equally important.
Demand for flexibility in later life continues to grow with lifetime mortgage lenders offering what the banks aren't
Can you pay interest on a lifetime mortgage?
Later Life Finance are a whole of market broker with access to lifetime mortgage providers from the whole market, including the new range of interest only lifetime mortgage providers.
Who are the top interest only lifetime mortgage providers in 2024?
- .Legal & General- RIO & interest only lifetime mortgages
- Standard Life- Lump sum and drawdown plans, voluntary repayments
- Livemore-RIO and Lifetime mortgages
What is the difference between an interest only lifetime mortgage and a voluntary repayment lifetime mortgage?
in 2023 the equity release council added voluntary repayments without an early repayment charge to their code of conduct rules.
in 2024 we are experiencing the biggest developments in lifetime mortgages since voluntary repayment options were introduced back in 2014.
Standard Life have launched an interest only lifetime mortgage following Legal & General offering an over 50’s interest only lifetime mortgage in 2023.
Livemore, a relatively new lender to the market, introduced RIO and TIO plans over the past 2 years following demand for later life mortgage lending.
What are the benefits of an interest only lifetime mortgage?
Later Life Finance has arranged homeowner lifetime mortgages for 10 years.
We have noticed a demand for voluntary repayment lifetime mortgages over the past few years.
The reason for this is because many years ago equity release had a negative reputation which was mainly due to the effect of compound interest eating up your equity.
Interest only lifetime mortgages make sense for everyone involved. Less equity being eroded, more inheritance for your estate, and for the providers, less risk of negative equity arising from compounding interest.
Are interest only lifetime mortgages safe?
The major attraction for homeowners considering an interest only lifetime mortgage is the fact the plans are safe from repossession due to non payment of interest.
If payments stop, the interest is compounded in the same way a conventional lifetime mortgage would be.
There is no risk of default or losing your home, as long as you keep the house full insured and in good condition.
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What are the typical percentages available with interest only lifetime mortgages in the UK?
What could I use an interest only lifetime mortgage for?
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- Interest only lifetime mortgages allow homeowners over 55 to borrow against your home with the option to make voluntary repayments to preserve more of your equity. (Payments are optional).
- No income or affordability checks to qualify, and takes around 8 weeks to arrange a lifetime mortgage. We have access to the best UK equity release companies to help the process run smoothly with expertise and service.
- The money is repaid at the end of your lifetime from the sale of your home.
- To check your eligibility and how much equity you can release, try our free equity release calculator
- Borrow between 20% and 50% of your home’s value, depending on age; enhanced mortgages available for those health problems.
- Negative equity guarantee for Equity Release Council members, which ensures you and your estate are fully protected. Martin Lewis mentions this when recommending how to safely choose a lifetime mortgage provider.
- Possible to move home and take the lifetime mortgage if moving to a suitable property
- Drawdown plans available to stage the borrowing over the coming years, providing more flexibility
- Get professional advice to understand if a lifetime mortgage is suitable.
What is the maximum age for an interest-only mortgage?
Most banks have an age limit of around 75 for mortgages and are less flexible with customers in later life.
Interest only lifetime mortgages and RIO’s have no upper age limit which provides a much greater range of options to older homeowners.
As experts in later life mortgages we offer lifetime mortgages nationwide and will also discuss the critical points to consider when deciding whether it is right for you.
Do Aviva offer an interest-only lifetime mortgage?
Aviva don’t offer an interest only lifetime mortgage, however they do allow voluntary repayments on their lifetime mortgages.
To review the lifetime mortgage market and compare your options with the range of available interest only lifetime mortgages contact Later Life Finance on 0800 2465228.
You can also get started with our free lifetime mortgage calculator.
Get your free lifetime mortgage calculation...
Can a 70 year old get an interest only mortgage?
You are entitled to make regular voluntary repayments to maintain control of the interest.
For example, if you want to avoid compound interest accruing, you can pay the interest back each month.
If you choose to do this, there will be no compound interest applied, so long as you continue to make these payments.
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How do I get out of an interest-only mortgage?
Interest only lifetime mortgages are becoming more popular as demand for flexible borrowing grows.
Our expert equity release advisers will provide detailed interest projections and illustrations for your consideration.
Your adviser will check if an equity release product is suitable and explain how much equity you are eligible for and compare the market to ensure you secure the best solution.
They will also explain how the lifetime mortgage interest may affect the remaining equity in your home and they should recommend you discuss your plans with any family members, if appropriate.
To find out how much equity you can borrow with a lifetime mortgage, request a call back for a detailed illustration.
Lifetime mortgage FAQs
As a specialist equity release broker, Later Life Finance are well positioned to review & compare the interest only lifetime mortgages to help you navigate your options.
Get a lifetime mortgage quote from Later Life Finance and compare the whole market.
We have access to exclusive broker deals to save you time and money when comparing the best equity release providers.
Our FREE equity release lifetime mortgage comparison service includes:
- Lifetime mortgage provider deal comparison
- Compare lifetime mortgage rates
- Find a lifetime mortgage adviser
- Interest only lifetime mortgage and retirement interest only mortgage comparison
- Full discussions around alternative options to consider before proceeding with a lifetime mortgage
- Access to lifetime mortgage calculators for detailed projections of your total interest costs
- Compare the best lifetime mortgage interest rates from the whole market
- Find the cheapest lifetime mortgage deals including cash backs and free valuations
- Find out how much can I borrow with a lifetime mortgage and what percentage
- Use our lifetime mortgage calculator to get started and book a free review
- Deal with an expert lifetime mortgage broker to access the whole market and compare the top deals
- Lifetime mortgage VS equity release covered for complete clarity on your options
- Learn how to apply for a lifetime mortgage and what to expect during the process
- Over 60 Lifetime mortgage advice
- Over 70s mortgages
- Interest only lifetime mortgage calculator
- How much can I borrow on an interest only lifetime mortgage?
- How do you calculate lifetime interest on a mortgage?