Hodge Lifetime has been a trusted provider of retirement products since its inception in 1965 and in 1991 were a founder member of the trade body – SHIP (Safe Home Income Plans), which is now known as the Equity Release Council. Hodge is most well-known for balancing solid products with social responsibility, intentionally fostering a strong connection with charity and social causes.
One area Hodge have been focusing on is the bridge that is needed between residential & retirement mortgages. They have been a leading innovator in this expanding post retirement mortgage industry and one of the first to offer a mortgage specifically designed for homeowners nearing, or in retirement.
The Hodge Lifetime 55+ mortgage is an interest-only mortgage available to borrowers who are 55 years old and over and designed to allow homeowners to take their borrowing into retirement where many mainstream lenders don’t. The homeowner makes monthly interest only payments on the loan for a fixed term. At the end of that term, the homeowner must repay the loan capital back to Hodge.
This product is available to homeowners who are 55+ and own their main residence. The amount available for borrowing is directly related to the homeowner’s ability to afford the repayment on the loan, which is based on income and outgoings. If the loan term required by the homeowner goes beyond their expected retirement date, the borrower must have a reasonable level of continued retirement income to be deemed eligible for this product. Therefore, proof of income & expenditures will be required to support the amount of borrowing.
The maximum mortgage amount that can be borrowed will be the lower of £500,000, 60% of the property value, or the amount that is deemed affordable based on the individual circumstances of the homeowner(s). This will usually be qualified by your equity release adviser with access to Hodge’s online calculation tools & thereafter a Decision in principle for verification. Please contact us directly for your Hodge 55+ Mortgage quote via Equity Release Supermarket on – 0800 678 5955
Eligible streams of income include employment, investment and rental incomes and pension earnings. If the employment income ends before the end of the repayment term, the homeowner must still be able to afford the mortgage and will need to evidence the fact affordability can still be maintained.
Adverse credit such as arrears, defaults and CCJ’s are acceptable, dependent upon the amount, longevity and level of credit registered. Please contact the Equity Release Supermarket team on 0800 678 5955
to check for eligibility.
For a property to be eligible for this product, it must be in England, mainland Scotland or Wales and it must be lived in permanently by the homeowner. It must have traditional construction and be in sound condition for lending purposes as evidenced by an independent surveyor appointed by Hodge Lifetime.
With the Hodge Lifetime 55+ mortgage, the homeowner pays the interest on the loan each month. The amount available to the borrower is directly related to their income level and outgoings. The borrower is able to set the payment term over which the money is borrowed, giving the homeowner some flexibility in determining their payment structure.
The maximum term for the Hodge 55+ Mortgage is up the point at which the youngest borrower turns 95. The minimum term is 5 years, with the term for this product is fixed at the outset, so at the end of that term, it is expected that the homeowner will repay the loan capital. There does need to be a suitable strategy, deemed appropriate by Hodge Lifetime, in place for repaying the loan capital at the end of the mortgage term. Examples of what an acceptable repayment strategy include selling other available properties, using investments or downsizing to a more affordable property.
Unlike equity release schemes, there are no protections in place with this mortgage product if the borrower has difficulty making payments. This is a standard 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 loan term is fixed with this product so the homeowner is expected to repay the loan capital at the end of that term. The homeowner must make all monthly interest payments as they fall due until the end of the mortgage term. 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.
Additional borrowing may be available with Hodge Lifetime’s 55+ 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.
The mortgage can also be transferred to a new home as long as there is adequate security for the mortgage.
The Hodge 55+ mortgage comes with a variety of fixed and variable interest rates. The rate illustrated above is a variable rate mortgage, however fixed rates are also available, hence contact the Equity Release Supermarket team for the latest interest rates on offer.
The Hodge Lifetime 55+ mortgage is ideal for the homeowner who wants to only make monthly interest payments for a specified period of time and happy to provide proof of affordability. With this product, the homeowner is able to simply make interest payments only until the loan capital is due at the end of the borrowing term. It can be used where people aren’t quite ready for equity release, and would prefer to take themselves to a point in the future when they feel they are the correct age.
Alternatively, where homeowners can’t get a mainstream mortgage due to being at a point just before retirement & lenders won’t lend for the specified period. Hodge provide a solution to bridging a period into retirement, where a repayment vehicle may arise, such a retirement or drawdown of crystallization of pension funds.
*applies to solicitors fees & standard disbursements if using Hodge solicitors
To obtain further information or to request a quotation on the Hodge 55+ Mortgage, please contact the Equity Release Supermarket team on 0800 678 5955