What is the 55+ Mortgage?

A flexible mortgage into retirement

The 55+ Mortgage is a standard residential mortgage, but designed specifically for older borrowers. You have to pay the interest charged on the 55+ Mortgage each month until the end of the term.

Unlike a lifetime mortgage, where the loan lasts for the rest of your life, you can select the term over which you want the 55+ Mortgage to last. This allows you to match the term of the loan to your future plans. However, you must be in a position to repay the loan at the end of the term by exercising your repayment strategy.

We will take a number of sources of income into account in assessing your ability to afford the loan, including:

  • Income from employment or self-employment;
  • State, personal and company pensions, whether in payment or not;
  • Investment income;
  • Rental income.

The following repayment strategies are acceptable in order to repay the loan at the end of the term:

  • Sale of your property when you downsize;
  • Sale of other property that you own;
  • Sale or maturity of your investments, including any endowments or lump-sums you are entitled to when taking your pension

The table below compares the 55+ Mortgage with other mortgages in Hodge Lifetime's product range.

55+ Mortgage Retirement Mortgage Interest roll-up lifetime mortgage
The loan term is fixed, and you can select the term that is right for you. The loan term is not fixed - it lasts until you die or move permanently into long-term care. The loan term is not fixed - it lasts until you die or move permanently into long-term care.
The loan is an interest-only mortgage. You must have suitable arrangements in place to repay the capital at the end of the term. This is an interest-only loan. The capital is repaid from the sale of your home after your death. This is an interest roll-up loan. The capital and interest is repaid from the sale of your home after your death.
The loan is repaid at the end of the term by exercising your repayment strategy.

This could include the sale of your home, or the sale of other properties or investments
The loan is repaid from the sale of your home after your death or move into long term care. The loan is repaid from the sale of your home after your death or move into long term care.
You must make all of the monthly interest payments as they fall due, until the end of the mortgage term. You must make all of the monthly interest payments as they fall due, at least until the youngest borrower reaches age 80, or the 5th anniversary of the loan (if later), when you can choose to have the interest rolled up. You are not required to make any payments during the term of the loan.
There are no safeguards if you have difficulties in meeting your mortgage payments. If you have difficulties in meeting your mortgage payments after age 80, you can choose to have the interest rolled up. You have the right to remain in your home until you die or move permanently into long term care.
Your home is at risk if you do not keep up the repayments on your mortgage. Up to age 80, or the fifth anniversary after taking out your loan (if later), your home is at risk if you do not keep up the repayments on your mortgage. You have the right to remain in your home until you die or move permanently into long term care.
The amount you can borrow is based on your ability to afford the mortgage, based on your income and expenditure, up to a maximum loan to value ratio.

We will consider your employment and retirement income in assessing affordability.
The amount you can borrow is based on your ability to afford the mortgage, based on your income and expenditure, up to a maximum loan to value ratio.

We will consider your employment and retirement income in assessing affordability.
The amount you can borrow is based on a loan to value ratio determined by your age.

Deciding on which plan is suitable for you can be a complex process, and it is a good idea that you obtain financial advice. In fact, we insist upon it. Read more about the role of the financial adviser.

Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

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