How To Get A Retirement Interest Only Mortgage
The good news is that last year the Financial Conduct Authority (FCA) announced plans to bring back interest only mortgages for older borrowers.
This was a response to the fact that nearly 2 million people in the UK are currently sitting on a interest only mortgage with no way to repay other than selling up with not enough equity to downsize property.
RIOs (Retirement Interest Only Mortgages) are standard mortgages designed for older borrowers to access later life lending options as their existing mortgage comes to an end.
These new RIOs provide a welcome alternative to equity release mortgages that are not suitable for everybody and can eat away at the capital you have built up in your home which may be an issue for some borrowers who want to pass on their estate to children/grandchildren.
With RIOs the main benefit is that your monthly repayment can stay on an interest only basis with repayment of the mortgage due on your death or if you need to move into a care home. This provides a lot of flexibility to homeowners who previously may have been facing the prospect of having to move.
Retirement Interest Only Mortgage - What Can I Borrow?
This will depend on the lender...
With a RIO (retirement interest mortgage) typically this will be based on affordability, so your retirement income and personal expenditure will determine how much you can borrow.
Post Office Retirement Link Mortgage
Free up funds from your home so you can live the life you want to.
Post Office through their Retirement Link Mortgage » provide an interest only mortgage option which allows you to borrow on an interest only basis up to age 80.
This could be right for you if you are looking for a good alternative to equity release or you are looking to home improvements or raise funds for something special e.g. a child's wedding or first home deposit.
You can borrow up to 30% of the value of your property and your property must be worth at least £250,000 to qualify. Click here for more details »>
is offering a great deal on their 5 year fixed rate interest only mortgage with no product fee.
Independent Advice On borrowing In Retirement
If you are not sure whether now is the right time to remortgage or whether you can get an interest only deal speak to our independent mortgage broker team who will be able to offer impartial advice.