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What is a lifetime mortgage?

A lifetime mortgage is the most popular form of equity release and is a loan secured against your home. It is a way of unlocking some of the money that is tied up in your property.

With a lifetime mortgage the money you release is tax-free and can be taken as a lump sum or a smaller initial amount followed by smaller releases at a later date.

You’ll continue to own your own home and with plans that meet the Equity Release Council's standards there’s a no-negative-equity guarantee, meaning you’ll never owe more than your home’s worth.

Many find the main benefit is that typically you don’t have to make any monthly repayments unless you wish to, as the loan plus roll up interest is repaid when the plan comes to an end. 

Equity release will reduce the value of your estate and may affect your entitlement to means tested benefits.
 

How does a lifetime mortgage work?

The value of your home, minus any outstanding mortgage and any other existing loans secured against it, is the equity you have in your property. This equity is often passed on as an inheritance, however an increasing number of people are tapping into some of this wealth with a lifetime mortgage to help boost their retirement finances.
 
With a lifetime mortgage you could release up to 56% of your property’s value in tax-free cash, dependent on your age, property value, health and lifestyle choices, and guarantee no monthly repayments - subject to your plans criteria.
 
There are several features available on different lifetime mortgage plans to help you customise your plan. If you wish to pay some of it back, with some plans you can manage the size of the loan through capital or interest repayment options. Other plans give you cashback. Then there are plans with further safeguarding features including inheritance and downsizing protection.
 

What is an enhanced lifetime mortgage?

You may be able to release more money from your property compared to a standard application if the youngest applicant has existing health conditions, such as diabetes or heart problems, or make certain lifestyle choices, like smoking.
 

How do I know which one is right for me?

Mortgage Advice Bureau Later Life offer lifetime mortgage products from a carefully selected panel of providers to offer a range of products designed to meet your needs. With competitive rates, high loan amounts and features such as no monthly repayments available, your adviser will talk you through your options and recommend a plan based on what’s important to you.

Unless you decide to go ahead, our service is completely free of charge as our usual advice fee of 1.5% of the amount released would only be payable on completion of a plan, subject to a minimum advice fee of £695.
 

Find out more

Whether you would like to find out some more information in your own time or discover straight away how much you could unlock from your home, we have a range of online tools to help.

Find out how much you could release from your home with our simple online calculator.