- The Capital 90 (1) 1.06% AER - is now on general sale and can be applied for exclusively online. £20,000 minimum deposit. You can add funds to the account until 3pm, 26 November 2021, after this no additions will be allowed. Find out more
- Premium Saver (4) 0.65% AER - is now on general sale and can be applied for exclusively online. £10,000 minimum deposit. You can add funds to the account until 3pm, 5 November 2021, after this no additions will be allowed. Find out more
How the Retirement Lifestyle Booster Works
How the Retirement Lifestyle Booster mortgage can help you make the most of your retirement
The mortgage will be secured on your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
Our Retirement Lifestyle Booster mortgage is a 10 year Interest-Only mortgage, for those aged 60 to 79, that pays regular monthly payment for 10 years and an optional lump sum.
This money can be used for house improvements, holidays and new experiences as well as supporting children and grandchildren, such as a home purchase.
So how does it work?
- Every month the Retirement Lifestyle Booster pays you a fixed sum. Same amount every month for up to 10 years.
- In return you pay us a set amount each month to cover the ‘average’ interest due.
- At the end of 10 years, assuming you’ve made all the payments, what you owe is what you have borrowed – no more and no less. No sting in the tail.
- You then repay the loan by selling your house and moving somewhere less expensive, mortgage free, just like you planned to do anyway.
How does it compare to a standard Interest-Only mortgage?
Compared with a standard Interest-Only mortgage there are two key differences:
- The loan amount is paid out in monthly instalments on the 10th working day of each month. Same amount every month for 10 years unless you tell us to stop it earlier. Any existing mortgage is repaid from the agreed loan at the start of the Retirement
Lifestyle Booster mortgage, along with the optional lump sum.
- Interest is charged on the balance outstanding each month, just like a normal mortgage. As the balance builds up the amount of interest charged increases, just as you would expect. What’s different is that you pay us an amount each month that covers the ‘average’ interest due over the 10 years of the loan. That’s more than just the interest due in the early years (the excess reduces the balance on which interest is charged) and less in the later years.
After 10 years the amount outstanding is the amount you’ve borrowed. You then pay back this amount.
The interest rate is variable and may rise or fall in future. If that happens we’ll recalculate the monthly amount you pay us, which may go up or down.
We’ll also recalculate the monthly amount you pay if you repay some of the money borrowed early or ask us to stop making the monthly loan payments to you. Otherwise the monthly payment you make to us won’t change.
For more information please read our Retirement Lifestyle Booster brochure
Our lending criteria guide outlines a summary of our current lending terms and the types of property we will lend on.
Five important points to note
- Unlike Equity Release plans where you have no monthly repayments and the interest due rolls-up thus increasing your debt, by using the Retirement Lifestyle Booster the amount you owe at the end of the 10 year term will be the same as the amount we
have lent to you.
- If interest rates rise and the payment you have to make to us increases to the point that you feel the Retirement Lifestyle Booster is no longer appropriate, then you can end the mortgage by repaying the balance outstanding. As long as the mortgage
has been in place for more than three years, no Early Repayment Charge will be payable and the only extra cost in addition to the mortgage balance outstanding is our Mortgage Exit Fee (currently £100). This may mean selling your current
home sooner than you had planned to do so or using another source of capital.
- At the end of the 10 year term you are required to repay the outstanding loan in full. This can be done by selling your home and moving to a lower value property, or using other money you then have available.
- A Retirement Lifetime Booster is a mortgage so will be secured against your property. This means that if you fail to make the payments or to repay the loan at the end of term, you could lose your house as it may be repossessed.
- By the ‘average’ interest due, we mean the amount required to leave the balance outstanding at the end of the 10 year term equal to the amount we have paid to you, less any money you opted to repay early.
How to apply
You can either apply through an independent mortgage broker or directly through one of our Mortgage Advisers.
If you have any questions or require more information we're happy to help:
Download our brochure
Find out more about how the Retirement Lifestyle Booster mortgage works.
Retirement Lifestyle Booster calculator
Use our calculator to see what your monthly advances could be and the maximum initial lump sum available to you.