Later life mortgages and lending
Unlock equity tied up in your home with a later life mortgage
What are later life mortgages?
Later life mortgages, more commonly known as lifetime mortgages, are a type of Equity Release product. If you're 55 or over, your home could help finance your retirement through equity release. This flexible financial option allows you to access your property's value while continuing to live in the home you love. Through a lifetime mortgage, you can unlock the equity you’ve built up, without the stress of monthly repayments.
Your home has supported you through the years – now it can help you embrace new opportunities. Whether you're dreaming of transforming your living space, supporting loved ones through education, or embarking on that bucket-list adventure, a later life mortgage could provide the means to make it happen. You can choose to receive your funds as a single amount or as regular payments to suit your lifestyle.
For peace of mind, professional advisers guide you through the available options, helping you understand features like the no negative equity guarantee and discuss the decision with family members. This way, you can make confident choices about your financial future while enjoying the rewards in your retirement.
Please be aware that taking out equity release will reduce the amount of inheritance you leave behind.
To find out how much equity you could release call our experts today.
Lines open: 9am to 5pm Monday to Friday
TextDirect: First dial 18001
We may record and / or monitor calls for training and audit purposes.
Please note that the information given on these pages should not be seen as advice to take out this product.
Types of later life mortgages
As above, later life mortgages and lifetime mortgages are the same thing. Just two different ways of describing a type of equity release. Our explanations of lifetime mortgages are easy to understand, because we know how much your home means to you, so don’t want to overcomplicate something so important.
Lifetime Mortgage Lump Sum
Lifetime Mortgage Drawdown
Understanding equity release and later life mortgages
Equity release isn’t for everyone, so it’s important to understand what equity release can offer you, as well as any downsides that you should consider.
Advantages of later life mortgages
Equity release offers retirees a range of options, as well as allowing them to remain in their own home.
With later life mortgages, you can:
- Receive your funds as a tax-free lump sum or regular payments, letting you match the borrowing to your specific needs.
- Maintain 100% ownership of your property with a lifetime mortgage while accessing its value - your home remains yours.
- After paying off any existing mortgage if needed, use the remaining funds toward your priorities, from home improvements to family support.
- Benefit from the Equity Release Council's no negative equity guarantee - you won’t owe more than your home's final sale value.
- Retain the ability to move home if needed, subject to the new property meeting your lender's criteria.
- Select your preferred repayment approach: defer until after you pass away or move into long term care, or make monthly payments similar to a standard mortgage.
- Know your maximum costs upfront - variable interest rates must have a defined upper limit for the entire loan term.
How do you apply for a later life mortgage?
Later life mortgages aren’t like a mortgage you may have got when you first purchased your house. Here’s what the process normally looks like if you’re interested in applying for a later life mortgage.
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Get expert guidanceConsult a financial adviser to evaluate if equity release suits your retirement plans. They'll provide regulated, objective recommendations on the most appropriate products for your situation, even if that means advising against a later life mortgage.
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Appoint a solicitorJust as with a house purchase, you'll need legal representation. Your solicitor will manage the application process, coordinate valuations, and handle all documentation with your chosen later life lender.
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Arrange a valuationYour chosen lender will require a valuation to be carried out on your property. You will need to ensure someone is available to meet with the surveyor.
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Receive the fundsUpon successful application and agreement from all parties, your lender will transfer funds to your solicitor for distribution to you.
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Enjoy your retirementOnce processed, use the released equity according to your priorities, whether that's enhancing your lifestyle, supporting family, or investing in your property's future.
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Remember, please seek independent legal and financial advice to fully understand the implications and ensure equity release aligns with your long-term financial planning. This page should not be seen as advice to take out any products.
Things to consider
Later life lending isn’t for everyone, and there are a lot of things to consider before taking out a later life mortgage.
Important considerations before choosing equity release:
- Be aware of benefit implications - Released funds may affect your eligibility for means-tested benefits, both now and in the future.
- Understand the inheritance impact - The loan and interest are repaid from your estate when the last borrower dies or enters long term care, which will reduce the amount available for your beneficiaries.
- Recognise the loan structure - This is a loan against your home, with interest charged until repayment upon death or moving into long-term care.
- Consider all advice costs - While an initial consultation is free, completion fees of £1,795 apply, plus additional lender and solicitor charges.
- Explore other options - Alternatives like downsizing or personal loans may better suit your circumstances. A financial adviser will be able to guide you here.
- Clear existing mortgages - Any current mortgage must be paid off as part of the process.
- Drawdown interest rates - With drawdown options, each withdrawal's interest rate is set when taken, which could mean higher costs depending on market conditions.
- Discuss with family - Your decision affects inheritance, so involve any beneficiaries in the conversation.
- Time your decision carefully - Starting earlier (minimum age 55-60) typically means accumulating more interest over time.
- Check repayment flexibility - Some providers require interest payments during the term, subject to affordability checks, while others allow voluntary repayments.
Eligibility for later life mortgages
Not every home is eligible for a later life mortgage, and each home and borrower are individually reviewed to ensure it meets any requirements.
The minimum later life mortgage requirements are:
- You must be 55 or over
- Your home must be in the UK
- Your home must be worth at least £70,000
Your home may not be eligible if:
- The property build is non-standard, such as prefab, a wooden or steel frame
- If it is a leasehold property, how long the remaining lease is, and whether there are any issues with the lease
Equity Release Advice
To help you access money from the value of your home, we provide an equity release advice service, regulated by the Financial Conduct Authority. Everything we do at LV= is focused on giving you honest advice and finding you a suitable equity release plan from the whole of the market with the fastest, friendliest service. We’re a member of the Equity Release Council, a voluntary scheme for equity release advisers and lenders.
We believe that everyone should have access to independent, regulated financial advice. It should not be seen as a luxury for the few who can afford it or who are experienced in using it. Why? Because it provides financial and emotional benefits. Good advice ensures better financial outcomes and frees people from the worry of making complex decisions that could have long-term implications.
IMPORTANT INFORMATION ABOUT LATER LIFE MORTGAGES
Here’s the need to know info, so you have the full picture
Releasing cash from your home can have implications on your estate's value and may impact your eligibility for state benefits. Keep in mind that you're not obligated to make repayments, which means the loan plus interest can accumulate rapidly, known as compound interest. Later life mortgages typically involve a lifetime mortgage, secured against your property, that may reduce your estate's value and affect long-term care funding.
LV=’s equity release products are protected under the Equity Release Council's No Negative Equity Guarantee, ensuring you won't owe more than the value of your home upon passing or entering long-term care.
When considering the best later life product for your needs, several factors come into play, including:
- The amount of equity you need to release and in what form
- The current value of your property
- Your age and any potential long-term care requirements
- The amount you wish to leave as an inheritance
Financial Advice on equity release
Need help?
We’re here to help, have a commitment-free chat with one of our friendly advisers today.
Lines open: 9am to 5pm Monday to Friday
TextDirect: First dial 18001
We may record and / or monitor calls for training and audit purposes.
FAQs on Later Life Mortgages
While a later life mortgage allows you to remain the owner of your home, a home reversion plan involves selling a portion of your property to the provider. This means you'll only retain ownership of a percentage of your home, corresponding to the percentage you haven't sold. Due to this, home reversion plans are generally less popular in later life lending.
Please note, at LV= we don’t offer a home reversion plan option
There are often fees associated with equity release and later life mortgages, from advice fees to product fees. This will vary from provider to provider, but your adviser will be able to provide exact fees for the products you are considering. You may be charged for advice, fees on individual products, solicitors fees and survey fees.
