Hodge Lifetime is one of the most reputable and reliable lenders in the current market, having launched the very first equity release plan in 1965. It now provides products through Julian Hodge Bank Limited and is the longest standing release provider in the UK.
The new Retirement Mortgage offered by Hodge Lifetime is a new and improved take on the traditional lifetime mortgage, allowing retirees to borrow on a more flexible basis. Hodge’s Retirement Mortgage allows you to borrow money in retirement to be used however you see fit. This money is secured against the value of your property. Each month, you are required to pay the interest only that accrues on the loan.
The amount of money that you can borrow will depend on a couple of different factors, most notably how much retirement income you have at your disposal. The loan will be repaid once your home is eventually sold, which sets it apart from conventional residential mortgages. This most typically takes place once you move into long term care on a permanent basis or pass away.
This particular product from Hodge Lifetime does offer you a special protection known as the ‘no-negative equity’ guarantee. Through this protection, you will not be required to make any additional payments should the sale of your home not cover the actual loan amount that is due. That means that your estate will never be left in the negative, even if your home sells for less than the amount you owe.
There are major differences between the Hodge Retirement Mortgage and other lifetime mortgages. For example, the loan term is not fixed on this product. It lasts until you move into long term care or pass away. This is also an interest-only lifetime mortgage loan. The actual capital of the loan is repaid once your home is sold as the balance will have been maintain level due to the interest only repayments.
Perhaps most importantly with the Retirement Mortgage, you are required to make monthly payments toward the interest accruing on your loan. This needs to be done at least until the youngest borrower in the home turns 80 years old. You can also stop monthly payments and allow the interest to roll-up thereafter. And lastly, and very importantly, you must keep up the payments on your mortgage or your home will be at risk.
The amount you can borrow with the Retirement Mortgage is based on your ability to pay for the mortgage. i.e. affordability. When you apply for this product, you will need to provide documentation that proves your income and your expenditures. Then, it will be determined just how much you can actually afford to pay but there are maximum limits applied. The good news is Hodge Lifetime’s sensible approach as they will allow retirement pensions, including state, occupational, personal & annuities. They will now accept buy-to-let incomes & investment incomes such to qualification. In certain circumstances they will consider state benefits. Contact us to check eligibility.
The Retirement Mortgage through Hodge Lifetime offers a very innovative alternative to the traditional lifetime mortgage but does operate quite differently. In order to take advantage of this product, you must ensure that you can make the monthly payments required and have a good credit history.
