One Family was formed in 2015 through the merger of Family Investments and Engage Mutual. One Family manages more than £7.5 billion and is a trading name of Family Assurance Friendly Society which has more than two million members. This lender is best known for specialising in Guaranteed Over 50’s Life Cover but is now adding more lifetime mortgage lending to its portfolio.
The Interest Payment Lite from One Family is a lifetime mortgage that allows the homeowner to receive a one-time lump sum payment as part of their equity release scheme. It also allows the homeowner to pay up to 100% of the monthly interest that accrues on the loan for a period of time that can be set by the homeowner.
This product maybe ideal for homeowners with mortgages at, or near retirement which are in need of repayment, but have no repayment strategy in place. The OneFamily Interest Payment Lite Plan will enable such mortgagors to switch away from the residential mortgage market by facilitating this OneFamily interest-only mortgage for the rest of their life.
The OneFamily Interest Payment Lifetime Mortgage plan offers homeowners a simple one-off lump sum cash payment to spend as they wish. This product is geared towards homeowners looking for the lowest fixed rates possible, but would like the security of knowing what their interest rate will be for the rest of the plan term. They will also wish to make repayments of Interest-Only that will enable them to maintain a level balance leaving greater equity in their property than a traditional roll-up plan.
The qualify the homeowner must be between the ages of 55 and 100 for the OneFamily Interest Payment Lite lifetime mortgage. If borrowing jointly, the loan-to-value will be based on the younger applicant’s age.
Eligible property values start at £70,000 and have no maximum threshold, though any property valued over £2,000,000 must be accompanied by a referral. The property must be located in England, Scotland or Wales to be eligible. However, please contact us directly on properties valued over £2 million as cases maybe individually underwritten, with bespoke quotes via Equity Release Supermarket on Freephone 0800 678 5955
Available loans range from £10,000 upto a £750,000 maximum. The interest payment amount is fixed at the outset of the loan and can range from £25 to up to 100% of the monthly interest accrued. The homeowner 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 determined. 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 4 payments over the course of their payment term. If the homeowner misses the fourth payment, the loan is converted to One Family’s Lump Sum Interest Roll-up plan or One Family’s 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.
Payments with the Interest Payment Lite are deducted via direct debit starting the month after completion. Loan-to-value’s (LTV’s) for the Interest Payment Lite begin at age 55 with 16.0% maximum lump sum for a single life and 15% for joint life. They rise to 46% for a single life and 45% joint life between ages 85-100. Joint life LTV’s are calculated based on the age of the youngest borrower.
There is no valuation fee applied with the Interest Payment Lite 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 for your specific valuation fee charge.
The early repayment charges with this product are favourably fixed for the first ten years following completion of the advance. They are 6% for years one through 5 and then they are 3% for years six to ten.
There is downsizing protection in place, which means that the homeowner can sell the home 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.
The lifetime mortgage is portable and also offers a no negative equity guarantee which ensures that homeowners do not have to worry about burdening beneficiaries. Should the loan end up more than the property value.
There is additional borrowing available with the Interest Payment Lite product, approval for which is contingent on the lending criteria imposed at the time of the application. The additional borrowing is available six months after the initial advance is completed. The minimum amount that can be borrowed is £4,000 and the maximum is the maximum LTV available on the product. Homeowners are not able to switch their product to one with a higher LTV.
The homeowner also has the ability to pay the monthly interest on their additional borrowing starting right after the completion of that borrowing.
The OneFamily Interest Payment plans come in both Lite & Standard versions. They differentiate by the LTV’s of each scheme and corresponding interest rate. The Payment Lite plan has lower loan-to-values than the Payment Standard, thus cannot release as higher amount. As a consequence, the Lite plan offers a lower interest rate than its counterpart, due to its perceived risk being lower.
The One Family Interest Payment Lite is a good option for any homeowner who is concerned with the impact of the interest roll-up that comes standard with many other lifetime mortgage products.
This product allows homeowners to pay against the interest accruing on their loan and the homeowner is able to dictate the time period over which they make those payments. Many homeowners are conditioned to make monthly payments and would like to continue in that same vein, in which case the One Family Interest Payment Lite provides an excellent equity release solution.
*Free valuation offer on property valuations upto £1m (pro-rata thereafter) & for limited time only
To obtain further information or to request a quotation on the OneFamily Interest Payment Lite Lifetime Mortgage plan, please contact the Equity Release Supermarket team on 0800 678 5955