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Lump sum lifetime mortgages

Available to homeowners over the age of 55, with a lump sum lifetime mortgage you unlock some of the equity in your home as a single, one-off amount. 

Many people choose this type of equity release plan if they have a large expense they need it for. Uses include funding home improvements, helping loved ones with a financial gift and paying off existing debts.

Although all lump sum lifetime mortgages will give you that one-off amount, there are still many different plans available. The different plans will offer different features, so you can find one that suits your needs.

Read our information on lump sum vs. drawdown plans to compare the two ways to access your tax-free funds.
 

Lower, fixed interest rates

A lump sum lifetime mortgage could offer lower interest rates compared to drawdown lifetime mortgages, meaning you could potentially save thousands on the compounding interest.

Your interest rate will be fixed for life too.

 

No monthly repayments

You won’t have to make monthly repayments, typically the loan, plus compound interest, is repaid when the plan comes to an end. There are plans that offer repayment options too, if that is something you would prefer.

 

No negative equity guarantee

We only ever recommend plans that meet the Equity Release Council standards and come with a no negative equity guarantee. This means the amount you owe will never be more than your home is worth.

You’ll still own your own home and typically the plan won’t come to an end until you, or the last remaining borrower, either passes away or enters long-term residential care.

 

Additional features

Some plans offer inheritance and / or downsizing protection. Depending on what you want or what your circumstances are, your adviser can discuss with you if they could be of benefit.

Downsizing protection enables you to move home and repay your lifetime mortgage without having to pay an early repayment charge, if your new property doesn’t meet the lender’s criteria. This is usually after five years of taking out your plan.

Inheritance protection lets you ring-fence a percentage of your home's future value, this is then able to be passed on as a guaranteed inheritance. This is regardless of how much the interest accrues.


Find out how much you could release from your home with a lump sum lifetime mortgage. Try our free, simple-to-use equity release calculator for an instant estimate

The benefits

  • You can unlock cash from your home, tax-free, to help meet your needs in later life
  • You’ll always retain full ownership of your home and can stay in it for as long as you wish
  • You can choose to make reduced or no monthly repayments to suit your circumstances
  • You’ll never owe more than your home’s worth
  • You may be able to remortgage your plan in the future to release further funds or secure a better interest rate, although this isn’t guaranteed and may be subject to early repayment charges

Potential drawbacks

Your equity release adviser will also outline the following important things to think about:

  • A lifetime mortgage is a loan secured against your home and subject to compound interest, meaning the amount you owe can grow quickly
  • Equity release will reduce the value of your estate and may affect your entitlement to means-tested benefits
  • Equity release may leave you with limited or no property equity remaining
  • Equity release will reduce your financial options in the future
  • A lifetime mortgage is a long-term financial product and is not designed to be fully repaid until the death or entry into long-term care of the last remaining borrower, otherwise early repayment charges may apply

Your other options

Before deciding on equity release, it's important you're aware of some of your other later life finance options. 

See if equity release is right for you

Equity release costs

Knowing the costs associated with equity release and how to help manage them is important.

Compound interest explained | Lump sum vs Drawdown

Things to consider

Because we play by the book we want to tell you 

  • Mortgage Advice Bureau Later Life offer lifetime mortgage products only from a carefully selected panel of providers.
  • We understand equity release isn’t for everyone, and we’ll never say it’s the right option for you unless we’re certain.
  • As part of our advice process, we'll consider whether retirement interest-only (RIOs) and other mortgages may be suitable and can arrange advice on these if appropriate. Advice fee will vary.
  • Unless you decide to go ahead, our service is completely free of charge, as our fixed advice fee of £1,295 would only be payable on completion of a plan.