Enhanced lifetime mortgage

An enhanced lifetime mortgage enables you to release more tax-free cash from your home, by taking into account your health and lifestyle choices.

Access more cash with an enhanced lifetime mortgage

Enhanced lifetime mortgages – also known as ‘impaired’ lifetime mortgages – enable you to release more cash from your home.

Based on your answers given to a health and lifestyle questionnaire you may qualify for a higher loan-to-value (LTV). Put simply, the poorer your health, the more you can borrow.

You don’t need to be ‘ill’ to qualify, any of these factors could mean you are given a larger amount of cash from your release of equity.

  • Being a smoker
  • Your body mass index (BMI)
  • Having high blood pressure
  • Taking prescription medication
  • Suffering from diabetes
  • Medical problems such as angina, heart attack, stroke, cancer
  • Multiple sclerosis or Parkinson’s disease
  • Retiring early due to ill health

This list is by no means exhaustive, and any health and lifestyle factors are worth mentioning to your adviser.

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Features of an enhanced lifetime mortgage

Like with a lump sum lifetime mortgage, enhanced lifetime mortgages are designed to release built-up equity in your home.

Here are some of the features:

  • Release more cash – the premise behind the enhancement is a lower life expectancy, so the more severe your health history, the more money you get.
  • Live in your home for life – you and any other homeowners have the right to live in your home (rent free) until you pass away or move into long-term residential care.
  • Take the cash as you need it – your adviser can help you chose between a lump sum or drawdown lifetime mortgage.
  • Get a fixed low rate for life – interest rates have dropped in recent years with many plans now below 3%. This is fixed for the life of the plan.
  • Still provide an inheritance – to be sure of leaving an inheritance for your loved ones some plans enable you to protect a percentage of your property.
  • No negative equity guarantee – no debt can be passed on to your beneficiaries as whatever happens to the value of your home you can never owe more than the price it’s sold for.
  • Repayments your way – with some plans you can make payments to reduce interest, but there are typically no monthly repayments to make.
  • Spend the money however you like – you can use the money you have already paid into your mortgage to boost your retirement income.

Frequently asked questions about enhanced lifetime mortgages

Which lenders offer enhanced terms?

Equity release companies specialising in enhanced lifetime mortgage plans include Aviva, more2Life and Just. They also offer standard lifetime mortgages, but have plans with enhanced terms (only available to those who qualify) offering higher maximum loan-to-values.

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What is the average interest rate?

Each lender sets their own rates which vary by plan and depend on how much you want to borrow compared to the value of your home (your loan-to-value). Many plans in the market have an interest rate below 3% but to get your personalised rate you need to speak to an adviser.

Get personalised rate

Do I qualify for enhanced terms?

Your adviser will take you through a simple and straightforward questionnaire to assess if you are eligible for an enhanced lifetime mortgage. Lenders do not usually require you to have a medical in order to qualify, but may write to your doctor for a medical report in some circumstances.

Check eligibility

Is an enhanced lifetime mortgage the right choice for you?

An enhanced lifetime mortgage might seem like a good option if you want some extra money and don’t want to move house. However, there are some important ‘Things to think about‘. You need to look at how it will affect your future choices and financial situation in later life too.

Our friendly advisers can help you to explore enhanced lifetime mortgages – and the alternatives – without it costing you a penny. Only if you decide to go ahead we charge an advice fee of £995, payable on completion.

Your adviser will be able to explain how:

  • A lifetime mortgage is a loan secured against your home. It will reduce the value of your estate and may affect your entitlement to means-tested benefits now or in the future.
  • If you want to pay off the loan early repayment charges (ERCs) can be substantial.

 

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Don’t just take our word for it

Can I say a huge thank you for all your time and patience in explaining and ensuring that I have the best contract for my needs. It was clear that your guidance was not money driven but a concern for my future welfare and again I thank you. I would have no hesitation in recommending your services to anyone in the future.

Mrs C Trigg, Nottinghamshire

From the outset our adviser encouraged us to explore our scepticism thoroughly and this inspired confidence. He listened patiently and carefully assessed our rather complicated set of requirements. He acted in a totally professional yet friendly way, continuously ensuring that we had understood the options and the implications of any decisions to be made. He encouraged us to move at our own pace, retracing steps – sometimes several times – ensuring that equity release was right for us.

Mr and Mrs JD, Berkshire

My husband and I were very happy with the advice our adviser gave to us re equity release. There were several questions I had in relation to releasing some money but had not thought them through. Our adviser explained everything very clearly and I didn’t feel the push to go ahead some firms give. I felt that either way the decision was ours to proceed or not.

Mrs Colley, Wales

Our adviser James was extremely helpful and went through all options with us. He listened to what we wanted and explained everything and took his time.

What really impressed me with James was that instead of thinking of himself he was genuinely trying to find the best option for us, which in today’s world does not happen. I would certainly recommend James to anyone as he is honest, reliable and makes you feel at ease.

Mrs D Pepper, Lancashire

Your enhanced lifetime mortgage safeguards

As proud members of the Equity Release Council, all of the plans we recommend meet their standards, so that you:

  • Have the right to remain in your home for as long as you want, or until you move into full time residential care
  • Have the freedom to move to another property without financial penalty (subject to criteria)
  • Will never have to repay more than the value of your home with the no negative equity guarantee