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Scottish Building Society Retirement Mortgage Rates & Details

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Compare Deals Retirement Mortgage Retirement Mortgage

Retirement Mortgage

  • Type Fixed
  • Rate 2.89%
  • APR 4.80%
Incentives:
  • Free Valuation
  • Legal Fees Contribution
Offers:
  • Refund of Valuation Offer*
  • £150 Contribution Towards Legal Fees*
  • 3-Year Early Repayment Charges

Background

The Scottish Building Society was Scotland's first ever building society in 1848 and has grown over the years with local mergers. It is the only independent building society based in Scotland and can still claim to be a mutual building society. This mutual status attributes the philosophy of careful money management and promotion of home ownership to its 30,000 members via its website and six building society branches.

The Scottish Building Society offer a range of mortgages to residents of Scotland, one of them being this residential mortgage that can help retirees borrow upto the age of 85. This can be used for any purpose and also people looking to raise capital to buy their rented property from the local authority or housing association. In addition, Scottish Building Society now have a Retirement Interest-Only Mortgage (RIO) which will lend on a lifetime mortgage basis - see our RIO Mortgages Section.

Eligibility

Scottish Building Society's Residential Mortgage is designed for owner occupiers from the age of 18, and upto retirement. The only conditions are there must be a minimum term of 5 years and a maximum term of 40 years.

Scottish Building Society will only lend on properties located Scotland - for owner occupiers who have sufficient and stable income to meet their monthly interest-only, or capital and interest mortgage payments.

Eligible income that is acceptable to Scottish Building Society in retirement includes pension income and as a guide they will lend 4.5x income to single applicants and for joint applicants it is 4.5x first income plus 1x second income or 3.5x joint.

The overall maximum lending limit is 90% of the property value or purchase price, which results in a maximum loan size of £300,000. For loan-to-values (LTV's) upto 80% of the property value the maximum loan is £350,000, and for LTV's of upto 70% the maximum loan is £500,000.

Restrictions are placed upon interest-only mortgage business. They are only available upto 75% of the property value or purchase price (whichever is lower) with a maximum loan size of £350,000.
Scottish Building Society will require a suitable repayment vehicle in place at the time of application, which can include - endowment policy; stocks and shares ISA; pension lump sum; and second/investment property.

Please call 0800 802 1051 for your personalised Scottish Building Society Residential Mortgage Key Facts Illustration.

Features

The Scottish Building Society Residential Mortgage is effectively a mortgage that can be utilised into retirement, which is income based and therefore will require verification of affordability by the lender. It can be used as a remortgage vehicle to generally raise additional cash in retirement, for whatever needs.

The amount borrowed is calculated using both income & property values criteria with the maximum mortgage being upto 75% of the property value for an interest-only mortgage. The loan is secured on the property and monthly repayments of interest-only need to be maintained for lifetime.

The tranche of money borrowed receives a 3-year fixed rate, with no early repayment charges applying after this 3-year period. Monthly interest-only payments are required with the effect of maintaining the mortgage balance at the same level for the duration of the plan term. Over-payments of 10% per year are acceptable without penalty.

The Scottish Building Society are not 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.

If an interest-only payment solution is requested, then monthly interest-only payments are required by Scottish Building Society. This will result in the balance remaining level for the duration of the plan term. However, there is a 10% overpayment option which does allow additional payments over and above the fixed monthly payments back to the lender.
Alternatively, this mortgage can be arranged on a capital and interest basis, should you wish to repay the mortgage in full over a fixed number of years.

Options

The Scottish Building Society Residential Mortgage facilitates owner occupiers to spend their tax-free cash as they wish, but with a view to protecting the equity in the home by making repayments of interest only.

There are a range of 3-year discounted and 3-year fixed interest rates which can be selected from, with rates dependent upon the loan-to-value of the mortgage and whether fee free options are selected.

*For remortgages on properties located in Scotland, the Scottish Building Society will contribute £150 towards legal fees and the cost of a standard mortgage valuation is refunded on completion.

**the rate quoted above is 2.89% fixed rate for 3 years - residential mortgage deal

To obtain further information or to request a quotation on the Scottish Building Society Residential Mortgage, please contact the Equity Release Supermarket team on 0800 802 1051 today.

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