Essential Home Improvements – Could a Lifetime Mortgage Help?

A Lifetime Mortgage is a form of equity release.

Equity release agreements are long term solutions designed to help certain homeowners, typically those over 60 years old, release part or all of the equity in their home.

Lifetime Mortgages allow you to take out a loan against the value of your property either by way of a lump sum at the outset or a series of smaller amounts taken over time.

Equity Release mortgages often provide the answer for retired homeowners who want to carry out major home improvements but don’t have the savings or income to fund the work.

It might be a new kitchen or bathroom, a conversion to make the house more comfortable in retirement or even essential repairs like a new roof or replacement windows.

Whatever the reason, Equity Release Mortgages can often provide the answer.

As with any mortgage however, it is important to understand what you are entering into before proceeding as equity release is not right for everyone.

Interest on a Lifetime Mortgage is accrued from the time funds are drawn but unlike a conventional mortgage, monthly repayments are not usually required. Instead, interest is added to the outstanding loan which is settled in full when the property is sold.

When the property is sold the balance on the outstanding mortgage, including accrued interest, will be deducted from the sale proceeds and you, or your estate will receive the remainder.

It is vital to fully understand what a Lifetime Mortgage will mean for you and as such it is always advisable to talk to an experienced, authorized advisor who can guide you through the choices available.