More and more older homeowners are beginning to find that their pensions are not enough for them to live comfortably in their retirement; as a result many have used equity release schemes to unlock some of the capital tied up in their homes. If this is something you are interested in and you are a homeowner aged 55 and over a Hodge Equity Release (now known as Hodge Lifetime) lifetime mortgage might be suitable for you.
Key facts about lifetime mortgages
- Allow you to access some of the money your home is worth without having to sell.
- Any equity released is tax free and can be used for anything you like such as cars, holidays or just making you feel more financially comfortable.
- You don’t have to make any monthly interest repayments.
How Does a Hodge Lifetime Mortgage work?
Hodge is just one of several lenders who offer lifetime mortgages, a lifetime mortgage is a loan secured against your home but unlike most traditional mortgage the debt is paid off through the sale of your house when you and your partner either die or move into care.
There are three key different types of so it is important to decide which would be the best option for you:
Roll-up Mortgage - this is the most popular lifetime mortgage. With a roll-up mortgage you do not have to make any monthly interest payments. Instead the loan plus any accumulated interest will be deducted from the money made from selling your house when you either pass away or move into a care home.
Fixed-repayment Lifetime Mortgage – This works by you agreeing to pay the lender a larger fixed sum than the amounted you wish to borrow when the house is eventually sold after you move out or die.
Interest-only Mortgage – This option works more like the standard type of mortgage you may be familiar with. You are required to pay a fixed or variable amount of monthly but the original lump sum is repaid from the sale of the property.
How much can I release with using Hodge Equity Release?
The maximum amount you can receive depends on what the market value of your home is at time of valuation; you may be able to use an equity release calculator to estimate how much you may be entitled to, however there will also be other factor can affect the amount you will receive such as;
- If you want a single or joint mortgage.
- Your age at time of application.
- How much you would like to leave behind in your estate for your beneficiaries.
What happens if the value of my home decreases?
If the value of your house falls less than the amount you borrowed, known as going into negative equity in some cases your beneficiaries may have to pay any debt you leave. However most lenders provide a ‘No Negative Equity Guarantee’ this guarantee means they ensure you or your beneficiaries will never have to repay any more than the sale price of your home, even if it is much less than the amount you borrowed.
Is Hodge Equity Release right for me?
To decide if an equity release lifetime is right for you it is wise to find out all of your options from different lenders, Hodge Equity Release is just one of many. It may also be that you decide Home Reversion would be better for you. To find out more about the different types of equity release and which one is right for you, simply click on the link and fill in the quick form and an equity release specialist will get back to you with free, no obligation quotes and advice.