Lifetime Mortgage for Over 60s – In-depth Guide
Our preferred equity release adviser is Age Partnership. For free and impartial money advice you can visit MoneyHelper.
Our preferred equity release adviser is Age Partnership. For free and impartial money advice you can visit MoneyHelper.
Are you curious about lifetime mortgages for over 60s? This guide is here to help! We know that a lot of people have questions about this. In fact, more than 7,000 people come to our website each month for advice on things like equity release and lifetime mortgages.
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.
If there are two homeowners who want to take out a lifetime mortgage together, then both people will need to be over 55 years old.
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.
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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.
How equity release could help
More than 2 million people have used Age Partnership to release equity since 2004.
How your money is up to you, but here’s what their customers do…
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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.
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The pros of a lifetime mortgage for over 60s
The advantages of using a lifetime mortgage are:
- You receive a loan as a lump sum or drawdown
- The loan comes with no monthly repayments
- You can use the money as you need
- 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.
For example, a £65,000 lifetime mortgage would become a debt close to £137,000 if you held the loan for 12 years on a compounding equity release interest rate of 6.4%.
This may not be an issue for you. But if you have loved ones relying on an inheritance to make themselves financially comfortable, it could be an issue.
How long does a lifetime mortgage take to be approved?
The standard timeframe to get a lifetime mortgage approved is between three and eight weeks.
The process includes a number of important steps, which you can read about here.