Five Frequently asked questions when considering releasing Equity from your home by way of a Lifetime Mortgage:
Will I retain ownership of my home? Yes
By taking out a Lifetime Mortgage, will it affect the amount I can leave to my children?
It will reduce your estate, however, there is an option with many providers now to ‘protect’ an element of the equity you have in your property. This means that no matter what the amount you owe when your mortgage requires repaying, or what the value of your property is, the amount you have protected cannot be touched and is guaranteed to be passed to your Estate on death.
Can I pay any of the interest on the Lifetime mortgage?
Yes, most of the providers of lifetime Mortgages now offer an ‘interest only’ option, which means that you can pay the some or all of the interest element on the lifetime mortgage, keeping the debt a known amount.
What is the difference between an Equity Release Mortgage, and Lifetime Mortgage?
Equity Release is the collective term for Home Reversion Plans and Life time Mortgages.
What if the amount I owe at the end of the mortgage is more than the house is worth? Will the lender ask my beneficiaries to repay the debt?
If your mortgage provider is a member of the Equity Release Council, then there is a ‘no negative equity guarantee’, meaning that the provider of your Lifetime Mortgage cannot take more than the property is worth on the date of repayment.