Payment-term lifetime mortgages

Is the latest innovation in the later life lending market right for your clients?

What is a payment-term lifetime mortgage?

A payment-term lifetime mortgage is a type of equity release that could allow you to release more tax-free cash at a lower rate of interest than you would otherwise be able to through a comparable lifetime mortgage. In return, you commit to mandatory payments until the oldest applicant (for joint

Interest rates have risen significantly over the past 18 months, and as a result some over-55s are now struggling to or can’t meet financial commitments, such as an existing mortgage. A payment-term lifetime mortgage could be the answer.

Payment-term lifetime mortgage product features

Access up to 8% higher LTV than comparable lifetime mortgages
No-negative equity guarantee and guarantee of tenure
Ad-hoc overpayments available (Min £50, max 10% annually)
Lower monthly costs with partial interest repayments
ERC exemption on repayment within 3 year of death/LTC of partner
Available from age 55-62 (+365 days) at application

When is a payment term lifetime mortgage right for your clients?

Younger borrowers aged between 55-62 with a property value of £125,000+

Borrowers who are able to make smaller monthly payments compared to a RIO

Clients who would like the flexibility to stop making payments sooner

Those who would like to secure guarantee of tenure sooner

Which option suits your client best?

Our Later Life Lending Navigator Tool can help you stay on the right side of regulatory changes whilst providing great outcomes for your clients – and, deliver a straightforward way of generating an additional revenue stream into your business this year. It provides a simple way to triage a customer based on their affordability and needs.

Developed by advisers and reviewed by industry stakeholders, our brand-new tool helps you assess and record the suitability of your clients’ different later life lending options, including RIOs, residential, lifetime mortgages and payment term lifetime mortgages, to ensure the product, and advice journey, you recommend is the right one.