Notices
  • Support for Coronavirus - how we're helping our customers See more

Answers to some of the most frequently asked questions on Retirement Interest-Only mortgages

The mortgage will be secured on your home. Your home may be repossessed if you do not keep up repayments on your mortgage.

Here are our answers to the most common questions asked about the RIO mortgage:

RIO stands for ‘Retirement Interest-Only’ mortgage. It is a mortgage where the amount we lend to you does not have to be repaid until a specified life event occurs. This could be if you go into long-term care or you (or for joint borrowers, the surviving borrower) pass away.

With a RIO mortgage you pay the interest monthly, so at the end of the term what you owe is what you’ve borrowed. Our RIO mortgage is suitable for you if you’re over 65 and would like to stay in your home and avoid downsizing.

A lifetime mortgage does not usually require the interest to be paid off monthly instead, the interest is added onto the loan.

With a RIO mortgage the interest doesn’t roll up (the interest isn’t added to the loan), because you pay the interest to us each month. This means when one of the specified life events triggers the repayment of the mortgage, it will always be the same amount that you borrowed originally.

Your monthly payments will pay off the interest owed on the amount you borrowed. You will need to repay the amount you originally borrowed when you, or each of you if you are joint borrowers:

  • Move out of the property to live somewhere else and it’s very unlikely you will move back. This might be the case if you go into long-term care

  • Purchase or move into a new property which will be your main residence, or you no longer use the property as your main residence

  • Sell the property

  • Pass away, or if you are a joint borrowers, the last occupying borrower passes away.
To apply for a RIO mortgage you must be over 65 and have at least 50% equity in your property. If you are applying for a RIO mortgage with someone else, you will need to prove that you can afford the mortgage on your own if the other borrower passed away.

Other than that our RIO mortgages require the same criteria as our other mortgages. You can see our normal owner occupier lending criteria here.
No you don’t need to have retired to qualify for this mortgage. You just need to be 65 or older.
No, a RIO mortgage is on an Interest-Only basis only. This means your monthly payments will go towards paying off the interest charged and not the money which was originally borrowed.
A registered contact is someone that you have said you are happy for us to speak to if we can’t get hold of you to discuss your mortgage.

If we’re able to, we will let you know that if we don’t hear from you within a certain period, we will speak with your registered contact.

If you have a RIO mortgage with someone else, each of you must have a registered contact, and this is required for the life of the mortgage. Each of you can have the same person as their registered contact, but you can’t nominate each other for your registered contact.

The registered contact isn’t responsible for any obligations in respect of the mortgage. We will only give them information about your mortgage if we can’t contact you. They won’t be able to transact or make any changes to your mortgage.

We explain the registered contact's responsibilities in detail in our RIO registered contact declaration document which will be given to you by your mortgage adviser or intermediary/broker.
You can change the registered contact for your mortgage at any time. You can request to remove the current registered contact without their authority. A suitable replacement should be provided by you, and the previous registered contact will be advised that they are no longer associated to the mortgage.

To make the change we will need to know your new registered contact’s details at the same time we remove your previous registered contact. Your registered contact should be replaced with a new registered contact at the point of the removal.
Your registered contact may request to be removed and you will need to let us know who you would like as the replacement.

Please read our RIO registered contact declaration document for full details. This can be found in the pack provided to you by your mortgage adviser or intermediary/broker.
If, during the life of the mortgage you get into financial difficulty and are unable to afford your mortgage repayments, you should let us know as soon as possible so we can explore alternative options with you. These options will depend on what we have on offer at the time but may include equity release, Joint Mortgage Sole Owner arrangements or payment holidays.

If after exploring your options none are suitable for your circumstances, you will need to sell your home and use the money from the sale of the house to repay the mortgage. If you are either unable or unwilling to sell your home we will be entitled to issue repossession proceedings.
If the mortgage amount you owe us is greater than what you sell your house for, you will still need to repay us the remaining loan. This may need to come from your savings, other assets or your estate.
You can. If you wish to move house during the mortgage term you can transfer the mortgage to another property, as long as it meets our lending criteria. You do this by selling your existing property, repaying the existing RIO mortgage and taking out a new RIO mortgage on the same day you buy your new property.

The terms of the RIO are transferred as part of this. You would need to get advice before doing this, either from our in-house advice team or an intermediary/broker of your choice.
Yes. These will be shown in the Illustration provided by your adviser. You can also find a list of all the fees that may apply during the mortgage here.
You can borrow up to 50% of the value of your property.
Yes you can. The amount per year you can pay will depend on which RIO product you apply for. Our current range of RIO products available can be found here.

Our RIO mortgages

See our full range of Retirement Interest-Only mortgages products available for purchase and remortgage.

How a RIO works

Find out how the Retirement Interest-Only mortgage works and who it is suitable for.