The OneFamily Interest Payment Lite is an interest-only lifetime mortgage scheme providing an initial tax-free lump sum, with the ability to make a predetermined level of monthly payments to help control the future balance.
Being part of the Interest Payment suite, the only difference between this Lite plan and the Standard version is the amount each will release via their loan-to-value percentages. In essence, the Lite Plan will release a lower loan amount - typically 5% less, however the resultant effect is a lower interest rate than the Standard deal.
The Interest Payment Lite plan accepts monthly interest payments which are fixed from the outset for 2 years initially and can range from £25pm, upto 100% of the monthly interest accrued. After the 2 year period, a variable annual rate of interest will apply. Payments for the Lite plan are deducted via direct debit starting the month following completion.
Homeowners can pay the interest for a payment term equivalent to one year - all the way up to the lifetime of the loan. However, the payment term, including the amount and duration of the interest payments, cannot be changed once started.
Under the Payment Lite Plan, payments can be made on behalf of the homeowner from an outside contributor, but the payments must be extracted from an account that is in the name of the borrower.
The homeowner is allowed to miss up to a total of four payments over the course of the lifetime of the Interest Payment Lite loan. If the homeowner misses the 4th payment, the loan is converted to a choice of either the OneFamily’s Lump Sum Interest Roll-up plan, or their Lump Sum Voluntary Payment Lifetime Mortgage. The rate that will be applied will be the interest rate that accompanied each product at the time of the original advance.
There is no valuation fee chargeable for properties that are valued up to £1 million. For properties over that threshold, the valuation fee varies dependent upon property value, hence please contact the Equity Release Supermarket team on Freephone 0800 678 5955 for your specific valuation fee charge.
The early repayment charges on the OneFamily Lite Plan are favourably fixed for the first ten years following completion of the advance. These are 6% for years one through five, and then they are 3% for years six to ten. No ERC applies thereafter.
The Payment Lite plan automatically includes a downsizing protection feature, meaning the homeowner can sell the property and repay the loan without incurring any early repayment charge, so long as the sale is at least five years after the initial loan was advanced.
This OneFamily lifetime mortgage is portable as they are members of the Equity Release Council and therefore all their plans come with a no-negative equity guarantee. This means that upon eventual sale of the property, any beneficiaries cannot be left with a debt, over and above the value of the property, owing to the equity release lender.