Lifetime Mortgage for Over 60s – In-depth Guide

Are you curious about lifetime mortgages for over 60 s? This guide is here to help! We know that a lot of people have questions about this. See related guidance.

In this guide, we’ll look at:

• The meaning of a lifetime mortgage.
• How a lifetime mortgage works.
• The good and bad points of a lifetime mortgage.
• How to get a lifetime mortgage.
• What happens when a lifetime mortgage ends.

We know that thinking about retirement and mortgages can be hard. It can feel like a maze with no clear path. But you’re not alone – we’re here to guide you through it with easy-to-understand advice.

Ready to learn about lifetime mortgages together? Let’s dive in!

Is it possible to get a lifetime mortgage for over 60s?

Yes, lifetime mortgages are generally available to people over the age of 55. There are minimal lenders who apply a slightly higher age restriction of 60 years old. 

Most standard lifetime mortgages start at age 55, but some payment-term lifetime mortgages are available from 50 and require interest payments for an agreed period. Home-reversion minimum ages and all other eligibility rules depend on the provider. Check the youngest applicant’s age and the actual product criteria. See related guidance.

It’s quite common for people to get a lifetime mortgage when they’re over 60. 

What is a lifetime mortgage for over 60s?

A lifetime mortgage for over 60s is the same as a lifetime mortgage for people of other ages. It works in the same way as explained earlier in this MoneyNerd guide. 

One thing to note is that your age could affect the amount of equity you can release. Someone taking out a lifetime mortgage at 60 will usually be allowed to access a greater percentage of their equity than someone taking out one of these loans at 55.

Why should over 60s consider a lifetime mortgage?

Over 60s should only consider a lifetime mortgage after receiving equity release advice. An advisor will explore alternative options and make you aware of the long-term consequences of using a lifetime mortgage. 

It has even become mandatory to receive equity release advice as part of the process. 

What is the maximum age for a lifetime mortgage?

Many lifetime mortgage companies don’t impose an upper age limit on applying for their plans. 

However, some lenders might apply an upper age limit, which is usually set at around 85, 90 or even 100 years old.

The pros of a lifetime mortgage for over 60s

The advantages of using a lifetime mortgage are:

1. You receive a loan as a lump sum or drawdown
2. Many lifetime mortgages allow interest to roll up without regular payments, but some require interest payments for a set period. Optional repayments, limits and any early-repayment charges depend on the contract.
3. Use proceeds for permitted purposes after assessing tax, benefits and risk.
4. You might only repay after you pass away

The downside of a lifetime mortgage for over 60s

The downside of a lifetime mortgage is that it can become expensive to repay.

Illustration only: £65,000 at 6.4% interest compounded annually without repayments becomes about £137,000 after 12 years, excluding fees.

These costs can affect your own future housing and care choices as well as any inheritance, even if you have no intended beneficiaries.

How long does a lifetime mortgage take to be approved?

Timescales vary with valuation, underwriting and legal work. Ask the provider and solicitor for an estimate; three to eight weeks is not a guaranteed standard.

The process includes a number of important steps, which you can read about here.