What is a lifetime mortgage?

A lifetime mortgage isn't that different from the standard mortgage you probably took out when you first bought your home. It's a loan secured against the value of your home on which interest is charged.

However, unlike a standard mortgage, there are normally no monthly instalments to pay (although some providers may require you to pay the interest on the loan).

With both equity release products from LV=, the interest is added to the loan to be repaid on the death of the borrower or if the borrower goes into permanent residential long term care. The loan is usually repaid from the profits of the sale of the property.

This is a lifetime mortgage. To understand the features and risks, ask for a personalised illustration.

Read more about our lifetime mortgages.

How much can I borrow?

The maximum you can borrow depends on your age and the value of your property. With LV=, this ranges from 20% of the value of your property if you are 60, to 50% if you are 95.

You can either borrow a lump sum as a one-off payment or you can choose to borrow a smaller amount initially and agree a maximum loan with us, which you can draw on from time to time over a 15-year period.

This way you'll only be borrowing, and therefore paying interest on, the amount you actually need.

Will I still own my home?

Yes, you will if you take out a lifetime mortgage with LV=.

As we're a member of The Equity Release Council this gives you greater protection as SHIP (former name) standards state that customers have the right to remain in the property for life.

What if I want to move?

However, if you decide to move, you may be able to transfer your lifetime mortgage with you to your new property subject to it meeting our lending criteria.

We'll allow you to transfer your lifetime mortgage to a smaller property as long as this also meets our lending criteria.

We won't charge you any penalties if we request you to repay part of the loan early because you're moving. Please note that you'll have to meet the actual costs of moving home.

Will I pay tax on the money that I've borrowed?

Under current tax rules, if you borrow money on your house you don't pay tax on it and there is no stamp duty to pay.

But remember that tax rules do change from time to time. Any references we make to taxation are based on our understanding of current legislation and HM Revenue and Customs practice, which can change.

How do I know if equity release is right for me?

To find out if equity release is right for you, you might want to follow the 6 steps below:

Step 1: Advice

Find an equity release adviser you feel comfortable with. Your adviser will assess your personal situation and help you consider the alternatives of releasing income or capital that do not involve losing some of the equity in your home.

Step 2: Talk to your family

Discuss equity release with your family and intended beneficiaries to your will. They might be able to help you raise the money you need.

Step 3: Personalised Illustration

Based on your individual circumstances, your equity release adviser will prepare a personalised illustration for you to tell you exactly how equity release could work for you.

Step 4: Independent legal advice

If you don’t already have a family solicitor, find one who specialises in equity release. Your solicitor will not only sort out all the legal details but will make sure you fully understand how the lifetime mortgage works and all the implications before you go ahead.

Step 5: Application, valuation & offer

Once you and your adviser have decided on the right scheme, your home will be valued and you will be sent an offer detailing exactly how much equity you can release.

Step 6: Completion

If you are satisfied with all these details you can agree to take out an Equity Release scheme. Once you have signed the required documentation you will receive your money.