Lifetime mortgage.
This is the most common type of Equity Release Scheme.
A lifetime mortgage is a loan facility available to homeowners who are over 55 years old.
Like a traditional mortgage, they are secured against a home, a second home or a buy-to-let property.
This allows you to raise capital whilst maintaining ownership of your home. The mortgage does not have to be repaid until the borrower either dies or moves into long-term care.
The flexibility of the schemes now allows you to make lump sum payments, part or full interest monthly or when you have funds available.
Some schemes will also enable you to ring-fence part of the value of your home to protect an inheritance for your family.
The mortgage can be repaid at any time, however the facility is set up to be cleared upon the death of the borrowers or when they go into long term care. At this point your home will be sold and the loan repaid. Any remaining money will then be paid to your estate.
Most lifetime mortgages offer a negative equity guarantee so that your estate will not be liable for any shortfall if the value of your house at the time of sale is less than the balance of the mortgage. We only offer lifetime mortgages that include a negative equity guarantee & adhere to the rules set out by The Equity Release Council.
Home reversion plan.
This plan allows you to sell part (or all) of your home while you stay living in it. You have the right to stay in the property until you either die or go into long-term care.
We do not offer advice on this type of Equity Release scheme.
Lifetime Mortgages – Equity Release
We hold the relevant qualifications, required by The Financial Conduct Authority, to offer advice on providing lifetime mortgages.
We will take as much time as required to fully understand your individual requirements and circumstances. We will then advise you on the best way to move forward with the right scheme to meet your needs.
We are directly authorised by the Financial Conduct Authority. We have access to a wide range of lenders offering schemes to meet your needs.
Who could an Equity Release Mortgage be suitable for?
- Someone Looking to move home.
- Repaying your current mortgage if you have come to the end of your term with
your existing mortgage lender & do not qualify for a traditional mortgage. - Home improvements to your current home.
- Initial cash release to pay for large personal items, such as a car, the holiday
you have been promising yourself etc. - Future lump sums in reserve for emergencies.
- Repaying existing loans and other debts.
- Small monthly/regular releases to boost current annual or monthly income.
- Help a family member.
Why Use Us?
Access to a wide range of equity release companies – We have access to the
whole of the market offering competitive lifetime mortgages.
Specialist Equity Release Brokers – PHLS Mortgage Services was established by
Clive Parish in 2002.
Clive has over 50 years of experience in the mortgage & property market dealing
with all types of mortgages & loans. Clive holds the necessary qualifications to
advise on & arrange Equity Release Mortgages.
Clive has now been joined by his Son Andy covering the Southeast of England.
PHLS Mortgage Services offers a full advice & recommendation service.
Friendly service – We pride ourselves on the friendly personal service we provide
to our clients, nothing is too much trouble. If Equity Release is unsuitable for you
then we can look at other options such as mortgages for over 60s and Retirement
Interest Only Mortgages. (see below)
We are finance specialists, not salespeople – You call us when you are ready, we
will not be making any sales calls to you. No pressure whatsoever!
How does a lifetime mortgage work?
If you release equity from your home using a lifetime mortgage, you will continue to
own the property. You don’t need to worry about affordability as there are no
monthly payments to make. The money borrowed and any interest accrued isn’t
repayable until after you die or go into long-term residential care.
Lifetime mortgages usually have a fixed rate of interest. Each year the interest is
calculated on a compound basis. This means that the interest is charged on the
original loan amount plus the interest added in the previous years. This does mean
that the interest can mount up quite quickly, as you’re paying interest on the interest.
If you prefer to pay off some of the interest each month or in lumps, then some
lifetime mortgages will allow you to do this.
What is a Retirement Interest Only (Rio) mortgage?
A RIO mortgage always involves paying off the interest as you go. While you can do
this with a lifetime mortgage, you can choose not to (in which case the interest
compounds instead). RIO mortgages may be available from the age of 50, which is a
slightly younger age compared to applying for a lifetime mortgage.
Can I pay off a Rio mortgage?
A RIO mortgage is an Interest-Only mortgage so you will not be paying off any of the
capital of the mortgage. You’ll need to be able to make the interest payment each
month until the end of the term.
What is the difference between Rio and equity release?
Unlike equity release, your affordability is assessed for a Rio mortgage to ensure you
can meet the monthly interest payments. Equity Release products don't have
affordability assessments as you don’t need to make any monthly payments – unless
you opt for a lifetime mortgage that allows you to make payments.
Which one is right for me?
It is important to talk to an experienced adviser to ensure you are fully aware of the
terms & conditions of each product & scheme to make sure it is right for you. This is a long-term financial commitment.