The Best lifetime Mortgage Rates During July 2021 | moneyfacts.co.uk

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Derin Clark

Derin Clark

Online Reporter
Published: 28/07/2021

July has seen the lifetime mortgage market continue to offer highly competitive rates, with some of the most competitive rates lower when compared with those available in June. This is good news for homeowners looking to release equity in their home, however, those considering equity release should keep in mind that it has a long term impact on finances and they should speak to an independent financial adviser to ensure it is the best option for their circumstances.

The plans highlighted below are not endorsed by Moneyfacts.co.uk but have been chosen as they offer competitive rates for the scenario that we have selected. It should be noted that other plans are available that offer similar competitive rates but may offer incentives, such as cashback, that suit the borrower’s needs better – as such borrowers should speak to an equity release broker who will be able to select the best plans for individual requirements.

How much can you borrow through equity release?

To find out how much you can potentially borrow through equity release, use this equity release calculator.

The best lifetime mortgage drawdown rates with a fee at minimum 30% LTV

 

Provider

Plan name

AER (APR)

Minimum property value

Max LTV (%) at age 70

Interest payable

Partial repayments*

Fee

Canada Life

Lifestyle Gold (Flexible)

2.98%
 (3.1%)

£70,000

31

No

No

£650

Legal & General Home Finance

Flexible Orange

3.00%
 (3.1%)

£100,000

30.7

No

Yes

£599

Legal & General Home Finance

Optional Payment Orange

3.00%
 (3.1%)

£100,000

30.7

Yes

No

£599

Pure Retirement

Sovereign (Drawdown) D

3.51%
 (3.7%)

£70,000

34.5

No

Yes

£895

*Partial repayments of up to 10% per annum are permitted without an early repayment charge applying.

 

The most competitive rate at a minimum 30% loan-to-value (LTV) this month came from Canada Life with its Lifestyle Gold (Flexible) plan offering 2.98% AER (3.1% APRC). This plan is available to those with a maximum 31% LTV at the age of 70 and properties must be valued at a minimum of £70,000. It allows a minimum advance of £10,000. It does not allow interest to be paid or partial repayments. The plan charges a fee of £650.

Legal & General Home Finance has two highly competitive plans this month. Both its Flexible Orange and Optional Payment Orange offer 3.00% AER (3.1% APR) and is available to those with a maximum LTV of 30.7% at the age of 70. Properties must be valued at a minimum of £100,000 for both deals and they allow a minimum advance of £10,000. Flexible Orange allows partial repayments but does not permit interest to be repaid, whereas Optional Payment Orange allows interest to be repaid but not partial repayments. Both plans charge a fee of £599.

Another competitive plan this month came from Pure Retirement with its Sovereign (Drawdown) D plan offering 3.51% AER (3.7% APR). This plan is available to those with a maximum 34.5% LTV at the age of 70. It requires that properties are valued at a minimum of £70,000 and allows a minimum advance of £10,000. Interest is not payable but partial repayments can be made. It charges a fee of £895.

The best lifetime mortgage drawdown rates without a fee at a minimum 30% LTV

 

Provider

Plan name

AER (APR)

Minimum property value

Max LTV (%) at age 70

Interest payable

Partial repayments*

Legal & General Home Finance

Flexible Orange

3.04%
 (3.1%)

£100,000

30.7%

No

Yes

Legal & General Home Finance

Optional Payment Orange

3.04%
 (3.1%)

£100,000

30.7%

Yes

No

More 2 Life

Capital Choice Superlite Drawdown 3

3.04%
 (3.1%)

£100,000

31%

No

Yes

More 2 Life

Capital Choice Superlite Drawdown 4

3.10%
 (3.2%)

£100,000

33%

No

Yes

LV=

Lifetime Mortgage Drawdown+ Standard 2

3.15%
 (3.2%)

£100,000

30%

No

Yes

LV=

Lifetime Mortgage Drawdown+ Standard 2 - 1% Cashback

3.16%
 (3.1%)

£100,000

30%

No

Yes

*Partial repayments of up to 10% per annum are permitted without an early repayment charge applying.

 

The two most competitive plans at a minimum 30% LTV that do not charge a fee are from Legal & General Home Finance. Both its Flexible Orange and Optional Payment Orange plans offer 3.04% AER (3.1% APR). They are available at a maximum 30.7% LTV at the age of 70. Properties must be valued at a minimum of £100,000 and the plans allow a minimum advance of £10,000. Flexible Orange allows partial repayments but does not permit interest to be paid. Optional Payment Orange allows interest to be repaid but partial repayments are not allowed.

More 2 Life Ltd also had two highly competitive plans this month. Its Capital Choice Superlite Drawdown 3 plan offers 3.04% AER (3.1% APR) and is available to those with a maximum LTV of 31% at the age of 70. Its Capital Choice Superlite Drawdown 4 plan offers 3.10% AER (3.2% APR), which is available to those with a 33% LTV at the age of 70. Both plans require properties to be valued at a minimum of £100,000 and they allow a minimum advance of £10,000. Both plans allow partial repayments but interest is not payable.

Two more highly competitive plans at this LTV that do not charge a fee came from LV=. Its Lifetime Mortgage Drawdown+ Standard 2 offers 3.15% AER (3.2% APR) and its Lifetime Mortgage Drawdown+ Standard 2 – 1% Cashback plan offers 3.16% AER (3.1% APR). Both plans are available to those with a maximum 30% LTV at the age of 70. Properties must be valued at a minimum of £100,000. They allow a minimum advance of £10,000. The plans allow partial repayments but do not permit interest to be paid.

The best lifetime mortgage drawdown rates with a fee at minimum 40% LTV

 

Provider

Plan name

AER (APR)

Minimum property value

Max LTV (%) at age 70

Interest payable

Partial repayments*

Fee

Pure Retirement

Heritage Drawdown Plus Standard Package (Fixed ERCs)

3.61%
 (3.7%)

£70,000

40

No

Yes

£895

Pure Retirement

Heritage Drawdown Plus Standard Package (GILT ERCs)

3.61%
 (3.7%)

£70,000

40

No

Yes

£895

Pure Retirement

Heritage Full Valuation Freedom 40 Drawdown Plus

3.76%
 (3.9%)

£70,000

40

No

Yes – up to 40%

£895

Legal & General Home Finance

Flexible Indigo

3.79%
 (3.9%)

£100,000

41.2

No

Yes

£599

Legal & General Home Finance

Optional Payment Indigo

3.79%
 (3.9%)

£100,000

41.2

Yes

No

£599

*Partial repayments of up to 10% per annum are permitted without an early repayment charge applying.

 

This month, Pure Retirement had the most competitive plans at a minimum 40% LTV that charge a fee. Its Heritage Drawdown Plus Standard Package (Fixed ERCs) and Heritage Drawdown Plus Standard Package (GILT ERCs) both offer 3.61% AER (3.7% APR). These plans offer a maximum 40% LTV at the age of 70 and properties must be valued at a minimum of £70,000. A minimum advance of £10,000 can be taken. Both plans allow partial repayments but interest is not payable. These plans charge a fee of £895.

Pure Retirement’s Heritage Full Valuation Freedom 40 Drawdown Plus is also highly competitive offering 3.7% AER (3.9% APR). A maximum LTV of 40% at the age of 70 is available for this plan and properties must be valued at a minimum of £70,000. It allows a minimum advance of £10,000. Interest is not payable but partial repayments can be made. It charges a fee of £895.

Also offering competitive plans this month was Legal & General Home Finance, which offers 3.79% AER (3.9% APR) on both its Flexible Indigo and Optional Payment Indigo plans. These plans are only available to those with a maximum LTV of 41.2% at the age of 70. Properties must be valued at a minimum of £100,000. The plans both allow a minimum advance of £10,000. Flexible Indigo allows partial repayments but interest is not payable. Optional Payment Indigo allows interest payments but partial repayments cannot be made. These plans charge of a fee of £599.

The best lifetime mortgage drawdown rates without a fee at a minimum 40% LTV

 

Provider

Plan name

AER (APR)

Minimum property value

Max LTV (%) at age 70

Interest payable

Partial repayments*

More 2 Life

Capital Choice Max 2 Drawdown

3.70%
 (3.8%)

£100,000

40.03%

No

Yes

More 2 Life

Capital Choice Max 3 Drawdown

3.80%
 (3.9%)

£100,000

41%

No

Yes

Legal & General Home Finance

Flexible Indigo

3.83%
 (3.9%)

£100,000

41.2%

No

Yes

Legal & General Home Finance

Optional Payment Indigo

3.83%
 (3.9%)

£100,000

41.2%

Yes

No

Just

J3 Drawdown

4.08%
 (4.1%)

£70,000

41.2%

No

Yes

Just

J3 Drawdown - Fixed ERC

4.08%
 (4.1%)

£70,000

41.2%

No

Yes

*Partial repayments of up to 10% per annum are permitted without an early repayment charge applying

 

The most competitive plan this month at a minimum 40% LTV in which no fee is payable comes from More 2 Life. Its Capital Choice Max 2 Drawdown offers 3.70% AER (3.8% APR) and requires a maximum LTV of 40.03% at the age of 70. More 2 Life’s Capital Choice Max 3 Drawdown plan also offered a highly competitive rate of 3.80% AER (3.9% APR), which is available to those with a maximum 41% LTV at the age of 70. Both plans require properties to be valued at a minimum of £100,000 and a minimum advance of £10,000 can be taken. They both allow partial repayments but interest is not payable.

Legal & General Home Finance has two plans offering highly competitive rates this month. Both its Flexible Indigo and Optional Payment Indigo plans offer 3.83% AER (3.9% APR), which are available to those with a maximum LTV of 41.2% at the age of 70. Properties must be valued at a minimum of £100,000. They both allow a minimum advance of £10,000. Flexible Indigo allows partial repayments but interest cannot be paid, meanwhile Optional Payment Indigo allows interest to be paid but partial repayments are not allowed.

Two plans from Just also had competitive rates this month. Its J3 Drawdown and J3 Drawdown – Fixed ERC both offer 4.08% AER (4.1% APR). These plans are available to those with a maximum LTV of 41.2% at the age of 70 and properties must be valued at a minimum of £70,000. A minimum advance of £10,000 can be taken. These plans allow partial repayments but interest is not payable.

How these charts have been compiled

These charts have been compiled from all equity release drawdown products listed by Moneyfacts on 28 July 2021. The products chosen have been selected from equity release products available to joint applicants and are based on a scenario where the youngest borrower is aged 70. The deals selected all offer drawdown, and as such there may be cheaper rates available on deals providing a lump sum only.

Find out how much money you could release from your home

Note

The Equity Release Service is provided by HUB Financial Solutions Limited. HUB Financial Solutions Limited. Registered office: Enterprise House, Bancroft Road, Reigate, Surrey RH2 7RP. Registered in England and Wales no. 05125701. HUB Financial Solutions Limited is authorised and regulated by the Financial Conduct Authority. Part of Just Group plc. Moneyfacts.co.uk itself is not authorised by the Financial Conduct Authority for equity release business, so we refer our customers to HUB Financial Solutions’ regulated service.

 

Any legal or contractual relationship will be with HUB Financial Solutions. There may be a fee for mortgage advice. Your adviser consultation appointment is FREE and carries no obligation. If you choose to proceed with a recommended product, an advice fee of £1,100 would be payable upon completion. Moneyfacts.co.uk will receive a  commission from the lender. HUB Financial Solutions does not offer advice on investments.

Disclaimer

All information is subject to change without notice. Please check all terms before making any decisions. This information is intended solely to provide guidance and is not financial advice. Moneyfacts.co.uk will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts.co.uk recommends you obtain independent financial advice.

Disclaimer

Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time. Links to third parties on this page are paid for by the third party. You can find out more about the individual products by visiting their site. Moneyfacts.co.uk will receive a small payment if you use their services after you click through to their site. All information is subject to change without notice. Please check all terms before making any decisions. This information is intended solely to provide guidance and is not financial advice. Moneyfacts will not be liable for any loss arising from your use or reliance on this information. If you are in any doubt, Moneyfacts recommends you obtain independent financial advice.

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