5 year discount retirement interest only
Discounted for 5 years
Early Repayment Charges apply.
This product may be withdrawn at any time.
Product key features
Who's the product for?
You must be aged 55 or over and receiving verifiable income. For joint applications, both of you must be aged 55 or over and each of you must be able to individually satisfy affordability.
You can use the sale of your home as your repayment strategy provided you have a minimum of 40% equity in the property. Up to 25% of the property value can be released for capital raising purposes.
Where you are buying your home in joint names you must demonstrate the mortgage is affordable should either borrower die. This can be established either by a transfer of pension rights, a specific life policy to clear the mortgage balance or any joint investments.
Lending on retirement properties
And if you’re looking to purchase a purpose built retirement property, we can help. Our later life lending range allows you to buy your retirement home and again, there’s no upper age limit.
Product related fees
There is an arrangement fee of £499. This fee can be paid up front by deducting the fee from the mortgage amount or added to the amount you borrow.
If you add the fee to your mortgage you will pay interest on the fee at the same rate as your mortgage.
Free standard valuation: We'll cover the cost of a standard valuation on a property valued up to £400,000. Properties valued over £400,000 will receive a contribution of £350 towards the cost.
Fees assisted legals: You have the choice of choosing our own solicitors, where we'll cover the cost of any standard legal fees, or receiving £150 cashback towards your own solicitor's costs. You'll be advised of any non-standard costs that will apply. If you choose to use our solicitors, they'll only act for us and won't provide you with independent advice regarding the mortgage transaction.
Mortgage amounts and repayment terms
The minimum mortgage amount of £50,000 and the maximum amount we will lend is £1,000,000.
We have a minimum property value of £75,000 which increases to £250,000 for properties located within the M25 corridor.
The maximum loan to value is 60% of the purchase price or valuation, whichever is lower.
Mortgage repayment terms
The minimum repayment term is 5 years but there is no maximum repayment term.
The mortgage must be repaid following a life event, including:
- death of the sole borrower or the surviving borrower for joint mortgages;
- sole borrower or surviving borrower for joint mortgages entering long-term residential care; or
- sale of the property.
Interest rate floor
The interest rate is floored and cannot fall below 3.29%.
Early Repayment Charges
Up to 10% of the original mortgage amount can be overpaid each year without charge. If the mortgage is redeemed or switched to another product during the discount rate product term then an Early Repayment Charge will apply.
The Early Repayment Charge will be calculated at:
- 5% of the amount repaid during year 1;
- 4% of the amount repaid during year 2;
- 3% of the amount repaid during year 3;
- 2% of the amount repaid during year 4; and
- 1% of the amount repaid during year 5.
Mortgage tariff of charges
The mortgage tariff of charges details the various fees and charges that may apply during the term of your mortgage.
The mortgage term used below is for illustration purposes only. This is an interest only mortgage with no defined term.
A mortgage of £120,000 payable over 40 years on a discounted variable rate for 5 years, currently 3.29% and then our SVR, currently 4.99% for the remaining term would require an initial payment of £341.26 followed by 59 monthly payments of £330.37 and 420 monthly payments of £501.07.
The total amount payable would be £350,931.49 made up of the mortgage amount plus interest (£230,781.49) with a mortgage arrangement fee of £499, a telegraphic transfer fee of £25 and mortgage exit fees of £125.
The overall cost for comparison is 4.7% APRC representative.
We're here to help
- Discuss affordability
- Help you understand our criteria
- Find the best mortgage for you
- Answer any outstanding queries
Your home may be repossessed if you do not keep up repayments on your mortgage.