Frequently asked questions
- Does the 55+ Mortgage conform to the standards laid down by the Equity Release Council?
- Will I have to make any repayments?
- How much can I borrow?
- Will my monthly payments change?
- How often can the Standard Variable Rate ("SVR") change?
- What happens if I can’t afford the monthly payments?
- Can I repay the loan at any time?
- Do I have to have an adviser?
- Will I still own my property?
- What happens if my circumstances change?
Does the 55+ Mortgage conform to the standards laid down by the Equity Release Council?
No. Unlike other products in Hodge Lifetime’s product range, the 55+ is not a lifetime mortgage. It therefore does not fall within the remit of the Equity Release Council’s product standards. The 55+ Mortgage therefore does not offer any safeguards traditionally associated with equity release products.
Will I have to make any repayments?
Yes. You must pay the interest on the loan each month.
You must also have sufficient means to repay the loan capital at the end of the term. You could do this by selling investments or assets, or by selling your home and moving to a smaller property. You will need to tell us what your chosen repayment strategy is when you apply for the loan.
How much can I borrow?
The amount we will lend you is based on an assessment of your ability to afford the loan. We will look at your employment and retirement income (currently being paid to you or forecast to be paid to you on retirement) and any loans or financial commitments you have in place. We must also be satisfied that your repayment strategy is of sufficient value to repay the loan at the end of the term.
These factors will also determine what loan amount we feel should be affordable for you now and in the future.
Will my monthly payments change?
If you have chosen a fixed rate loan, your repayments won’t change during the fixed rate period. If you have chosen a discounted rate loan, or once your loan reverts to the SVR, the repayments could change at any time.
How often can the Standard Variable Rate ("SVR") change?
We review the SVR regularly, and will give you reasonable notice if it is going to change.
The SVR may change to reflect changes in the Bank of England base rate, our funding or administration costs, economic effects and the impact of new laws or regulations. There is no guarantee that just because the Bank of England base rate changes, the SVR will change by the same amount.
What happens if I can’t afford the monthly payments?
Please contact us as soon as possible. The earlier we become aware of any payment difficulties you may have, the more chance we have of helping you. We will always work with you to find, where possible, a solution or arrangement to address your problems.
However, you should be aware that, in the worst case, your home may be at risk of repossession if you can no longer meet your payments.
Can I repay the loan at any time?
The loan can be repaid at any time, however an early repayment charge may apply. During any initial fixed rate or discount period, overpayments of up to 10% can be made without incurring an early repayment charge using the Flexible Repayment Option.
Do I have to have an adviser?
Yes, we feel it is essential to obtain financial advice before applying as it is important to consider all options on the market.
Will I still own my property?
Yes, you retain 100% ownership of your property.
What happens if my circumstances change?
Your 55+ Mortgage is portable, and you can take it with you if you move house. However, you will be responsible for the costs involved in transferring the mortgage, and your new property must form suitable security for the mortgage.
Taking out the 55+ Mortgage could affect the options that are open to you in future years. Having to pay the interest on the loan will reduce the amount of retirement income you have available to fund your retirement, for example if you need to pay for care in the future. It is important that you discuss this with your adviser before you take out the mortgage.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.Next Page: Document library