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 specially designed Lifetime Mortgage for retirees over the age of 65. 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.
Scottish Building Society’s Lifetime Mortgage is designed for homeowners who are close, or in retirement and have sufficient and stable income to meet their monthly interest only mortgage payments. They will only lend on properties located Scotland.
Eligible income that is acceptable to Scottish Building Society is 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 35% of the property value or purchase price, whichever is lower.
Scottish Building Society’s minimum loan size is £30,000 and the maximum loan is £300,000.
This Lifetime Mortgage is available on both a single and joint life basis with a minimum age of youngest homeowner being 65 with no upper age limit applicable.
Please call 0800 678 5955
for your personalised Scottish Building Society Lifetime Mortgage Key Facts Illustration.
The Scottish Building Society Lifetime Mortgage is effectively a mortgage geared towards retirement which is income based & therefore verification of affordability is required 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 35% of the property value. The loan is secured on the property and monthly repayments of interest-only need to be maintained for lifetime. The retirement mortgage can accept the repayment method to be the eventual sale of the property, or when the last person has died or moved into care and the property is sold.
The tranche of money borrowed receives a 3 year fixed with no early repayment charges apply after this 3 year fixed rate 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 in the first 3 years.
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.
There is a regular monthly interest only payment commitment imposed by Scottish Building Society, thus the balance will remain level. However, there is a 10% overpayment option which does allow homeowners to make additional payments over and above the fixed monthly payments back to the lender.
The Scottish Building Society Lifetime Mortgage facilitates homeowners 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 three interest rates which can be selected from ranging from two discounted variable rates with different fee free options, and a 3 year fixed rate – quoted above.
For remortgages on properties located in Scotland Scottish Building Society will contribute £150 towards legal fees and the cost of a standard mortgage valuation is refunded on completion.
To obtain further information or to request a quotation on the Scottish Building Society Lifetime Mortgage, please contact the Equity Release Supermarket team on 0800 678 5955