The Fixed Lifetime Mortgage allows your clients a flexible cash facility against which they can draw down cash advances over time with the maximum amount being based on: their age, the value of their property and their lifestyle and medical conditions (if applicable).
How it works
- A fixed charge is determined at outset and applies to your clients initial cash advance. The charge will not increase during their lifetime.
- No repayments are made on the money borrowed and fixed charge is only repaid once your client dies or moves permanently into care.
- Your client can continue to own their home and benefit from any increase in its value.
- Your client will know the effect on their estate at outset.
- Your client has the ability to drawdown money on a regular basis (up to a maximum cash facility) or on a one-off basis.
- If your client decides to take a further cash advance a new further fixed charge will be determined for that cash advance.
- The maximum charge can be arranged is 75% of the value of the property (restrictions apply for sheltered accommodation).
- The plan is currently only available in England and Wales.
Moving into long term care If your client needs to move into permanent care and their property is sold, the Fixed Lifetime Mortgage gives offers two choices:
1. An income option where the whole of the fixed charge is repaid and a regular income, guaranteed for life, is paid through our Lifetime Income Plan.
2. The income can be foregone and a reduction on the fixed charge can be arranged. This will be a minimum of 5% of the original property value.
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