Bath Building Society RIO Mortgage

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RIO Mortgage

Type Discounted
Rate 3.55%
APR 3.70%

Offers:

No Early Repayment Charges
Interest-Only Mortgage
No LPA Requirement
Maximum LTV - 50%

Background

The Bath Building Society operates throughout th UK and benefits from the support of the City of Bath and surrounding areas. Bath Building Society can trace its roots back to 1904, when it was set-up originally as a Friendly Society and used it's members’ money to buy rental property. It became a Building Society in the 1950s, lending money to people in the City to purchase their own homes.

Bath Building Society is a well capitalised mutual organisation providing a secure home for its Members’ savings as well as prviding a range of mortgage products including specialist Retirement Mortgages. Bath Building Society do not consider lending to retirees an issue if they are in receipt of verifiable income, allowing elderly homeowners availability to Retirement Interest Only Mortgages (RIO’s) on their property.

Eligibility

The Bath Retirement Interest Only Mortgage (RIO) is designed specifically for homeowners who are over the age of 65 and require access to the equity in their property to enable them enhance their lifestyle in retirement.

This RIO mortgage could be used as a remortgage vehicle or to assist with a house purchase.

The Bath RIO Mortgage is available on both a single and joint life basis with a minimum age of the youngest homeowner being 65. There is no maximum age limit or term.

Bath Building Society have a sensible approach to lending in retirement whereby on joint applications they will assess each applicant individually in order they could sustain the mortgage solely throughout the term, should their partner pre-decease them.

The minimum loan on this RIO mortgage is £50,000 with a maximum of loan upto £500,000. For mortgage applications above £500,000 please call the Equity Release Supermarket team on Freephone 0800 802 1051. to check qualification and request your bespoke quotation.

Household income must be at least £20,000 after deductions. The Society uses income and expenditure analysis and then applies multipliers to assess the maximum loan available. No credit scoring system is used and each case will be underwritten on its own merits.

Bath's minimum property valuation on their retirement mortgage is £100,000, which must be the homeowner's main residence and must be located within England and Wales.

Adverse credit such as arrears, defaults and CCJ’s can be acceptable, dependent upon the amount, longevity and level of credit registered. Please contact the Equity Release Supermarket team on 0800 802 1051. to check for eligibility.

Features

RIO Mortgage provides an initial tax-free lump sum cash release for immediate use, with the ability to make monthly repayments of only interest to Bath.

There is no maximum term - it will run for the duration of the last surviving homeowner. There is no need for any repayment strategy such as endowment, investment or repayment basis. The loan is an interest-only lifetime mortgage with no end date set.

The maximum loan-to-value (LTV) on this interest-only mortgage is 50% of the property valuation, subject to qualification of income to support this figure.

Unlike equity release schemes, there are no protections in place with this mortgage product if the borrower has difficulty making payments. This is a residential mortgage which means that there are no safeguards if something unexpected takes place, preventing the homeowner from being able to make payments. So, to make use of this product, homeowners must be confident that their income will stay sufficient & constant enough to meet their payment obligations.

The homeowner must make all monthly interest payments as they fall due until the RIO mortgage finishes. This means that the homeowner could put their home at risk if they do not keep up with payments.

If a single applicant passes away before the end of the term, the mortgage will still have to be repaid, usually by sale of the property. On joint applications, the mortgage will continue in the name of the survivor.

The Bath Building Society aren't members of the Equity Release Council and consequently their plans don’t have the code of conduct applicable like other equity release schemes such as the no negative equity guarantee.

There are no early repayment charges (ERC’s) under this Bath Retirement Interest Only Mortgage.

Options

This Bath Retirement Mortgage enables any homeowner to spend their tax-free cash as they wish, but unlike roll-up equity release schemes also have the ability to make monthly interest-only repayments to control the future balance.

Bath Building Society will accept applications which are based on retirees house purchasing, remortgage business and on unencumbered properties.

Unlimited overpayments are permitted on this RIO mortgage without penalty.

Additional borrowing may be available with the Bath RIO Mortgage, but availability and approval is not guaranteed. The amount available is directly related to the homeowner’s ability to afford the higher loan amount and will therefore go through the same affordability verification process.

Bath's RIO mortgages currently offer lifetime discounted rates within its product range. However these are subject to change, hence contact the Equity Release Supermarket team on Freephone 0800 802 1051. for all the latest interest rates on offer.

Once a specific deal ends, it will revert to the lenders standard variable rate, unless another deal is selected before or at expiry.

To obtain further information, or to request a quotation on the societies RIO mortgage, please contact the Equity Release Supermarket team on 0800 802 1051.

Practicalities

This Retirement Interest Only Mortgage is ideal for the homeowner who wants to only make monthly interest payments over their lifetime and happy to provide proof of affordability. With this product, the homeowner is able to simply make interest only payments for the rest of their life.

RIO mortgages will ensure the balance will always remaining the same as it started, assuming repayments are maintained. This strategy is ideal for those looking to protect and maximise their inheritance, or looking to retain as much capital as possible for taking equity release at a later date.

This product is ideally suited for those looking for an interest-only mortgage and do not want to downsize, but remain in their home.

RIO’s can prove useful for homeowners who aren’t quite ready for equity release, and would prefer to take themselves to a point in the future when they feel they are a better age, or wish to stop making repayments. They are also ideal for those looking for an interest-only mortgage and do not want to downsize, but remain in their residence.

Alternatively, where homeowners can’t get a mainstream mortgage, or even where an interest-only mortgage needs repayment, the Bath RIO mortgage can provide an excellent solution.

Another concept for these RIO mortgages is that Bath Building Society are effectively offering an interest-only bridge facility into retirement. Maybe this is to a certain point where a repayment vehicle becomes available, such as a tax-free lump sum from their pension, or drawdown by crystallization of pension funds.

***the rate quoted above is a 0.75% discounted rate for the lifetime of the plan term - NO requirement for an LPA being in place

To obtain further information or to request a quotation on the Bath RIO Mortgage, please contact the Equity Release Supermarket team on Freephone 0800 802 1051.

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Bath Building Society Interest Only RIO Mortgage (non-LPA)