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Lifetime Mortgages article series, written by Chris Almond our Lifetime mortgage specialist. This is the first article in a dedicated series.
Financial Freedom in Retirement - A guide to lifetime mortgages
Retirement is something we all look forward to – an opportunity to do all those things we longed to do whilst we were busy working or bringing up the family. A time for leisure activities, hobbies, holidays or traveling.
Lifetime mortgages – How do they work?
Lifetime mortgages offer a safe and straightforward way to unlock some of the value held within your home securely, without having to move house.
With a lifetime mortgage, you could safely unlock the cash built up in your home without having to make any monthly repayments whatsoever.
A lifetime mortgage works by converting part or all of the value of your property into a cash lump sum or income for life. This could help to make your retirement years more comfortable.
The main features of a lifetime mortgage are:
- No monthly repayments to make in your lifetime
- You can stay in your home for as long as you choose – for the remainder of your life or until you move into care
- No-negative-equity guarantee, so the amount owed will never exceed the value of your home.
Do I qualify?
In general terms, you would qualify if:
- You are both aged 55 or over
- Your property is worth at least £70,000
- You have little or no outstanding mortgage (when your funds are released, any outstanding mortgage must be paid)
Your needs and financial circumstances in retirement may change over and this may affect how you decide to use the cash you release. A professional adviser will discuss all your options with you, looking at how you can finance your needs today and in the future, through an lifetime mortgage or other means.
What could I use the money for?
The great thing about a lifetime mortgage is that you can spend the money in any way you choose. Maybe you want to buy a new car, add a conservatory onto your house, or buy an annuity to generate an income.
The most popular uses of lifetime mortgages:
- Pay for home/garden improvements:
- Pay for holidays:
- Pay off outstanding debts:
- Treat family or friends:
- Pay for a special celebration:
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