Benefits of obtaining a lifetime mortgag
- Last updated on September 21, 2015 at 9:45 am
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Something people have in common is that all of us want to live a cushty life for as long as possible. We wish to enjoy ourselves in spite of our age, and to achieve this we all need money. That is something more important the majority share, everyone needs funds. For some money comes effortless, other folks should strive all their lives to pay the bills, but precisely what happens when you get retired and your pension does not cover your cost of living, or you got tired of working and you would like to take it easy. Where do you turn then? One of the most effective ways out is taking a loan and if you're a home-owner, then odds are one of the lifetime mortgages might suit your needs perfectly.
Almost all of you probably know very well what an equity release is. In plain English it " is a method of keeping use of your property or other item which has got capital value, whilst getting a lump sum or a regular flow of income, using the value of the house." Lifetime mortgages work more or less identically. Basically lifetime mortgages are a type of loan you are taking which is secured on your home. The beauty of a lifetime mortgage is that you have to pay it back either when you die, sell off your home or move into a long-term care facility. For as long as you live in your own home, you can savor both the funds and the comfort of your home.
Just like any kind of loan, there is always a "catch". Of course, you will need to pay out interest on the loan that you had taken. However, there are plenty of methods for you to decide on how to pay it depending on the type of the lifetime mortgage that you opt for: roll-up mortgage, interest only mortgage, fixed-repayment lifetime mortgage or drawdown lifetime mortgage.
To make it fairly simple, the roll-up mortgage helps you take a lump sum payment or a regular income without having to make any monthly payments on the loan, nonetheless, the interest is added on a regular basis in a compound way so it ‘Rolls Up’ until the loan is paid back. With interest only mortgage, you'll need to make month to month repayments of the interest due on the loan. The fixed-repayment lifetime mortgage gives you the flexibility to consent before hand on a fixed amount of cash that you will have to repay, in contrast to having to pay regular monthly interest.
With that said, lifetime mortgages give you a true opportunity to have a loan and love your life. Everything you need to is discover the proper type of mortgage for you and learn the potential risks you're signing up for. For more information on lifetime mortgages, check out http://ansop.com/lifetime-mortgages.
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