A reverse mortgage is known in the UK as a lifetime mortgage, and is often considered by people approaching or in retirement. A lifetime mortgage lets you release equity from your property as a secured loan, which isn’t repaid until your death or you have to move into a care home for permanent residence.

Unlike some other plans, you can remain in the property until your death if you wish, as you remain the owner of the property. On your death, or when the house is sold, the agreed loan amount is repaid to the company that arranged the lifetime mortgage.

There are various types of lifetime mortgage for you to choose from. It is recommended that you seek advice from a professional adviser who has taken a CeMAP training in Scotland or elsewhere in the UK, so that you can be sure that you are making a sound decision.
If you don’t want to make any repayments during your lifetime, you could apply for a roll-up lifetime mortgage. With this product, you won’t pay any interest every month, but the interest will be added to the debt so that it increases. The final amount to be repaid will be much larger than the initial amount.

If you would like to know how much will be repaid when the house is sold, consider a fixed repayment lifetime mortgage. You will receive a lump sum but the amount repaid will be considerably larger.

There are other ways to release equity from your property so you should seek guidance to ensure you have the most suitable method for you.

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