Here are some of the features of our Lifestyle Flexible Option plan.
- The size of the cash reserve is fixed at the beginning of the plan. The minimum total reserve is £15,000 from which at least £10,000 must be taken as an initial loan.
- The remainder of the money available to them is held in a reserve which they can draw on whenever they like.
- The client will only pay interest on the amount released, not the full value of the reserve. The interest rate charged on each release from the reserve will be that current at the time the release is taken.
- 'No negative equity' guarantee means clients will never have to pay back more than their home is worth, as long as it is sold for the best price reasonably possible.
- Clients continue to own their own home and can live in it until they die or need to move into long-term care.
- Although taking out a lifetime mortgage will always reduce the inheritance your client can leave, with Aviva they can opt for our inheritance guarantee. This means when the clients home is sold, we guarantee that the client or their estate, will get a specified share of the amount it’s sold for. Choosing this option will reduce the amount they can borrow and can only be added at outset. For full details please speak to your consultant or see our equity release core brochure.
- Even if your client does not choose our inheritance guarantee there is still potential for leaving an inheritance. However, this is not guaranteed because interest builds up during the lifetime of the mortgage and is charged on the total amount borrowed and the interest already added. This quickly increases the amount that the client owes and will reduce the value they have in their home, possibly to nothing.
- No repayments are required until the client dies or moves into long-term care. However, there may be a substantial early repayment charge if the client pays back the loan early.
- Clients may be able to transfer their lifetime mortgage to a new home as long as it meets our criteria for acceptable properties.
- Clients receive a tax-free cash lump sum to spend on what they want, although depending on the size of the lump sum and the client’s personal circumstances, their tax position and entitlement to welfare benefits may be affected.
- Additional borrowing may be available in the future, depending on our lending criteria at the time. Additional borrowing is not guaranteed.
- Interest rate is guaranteed for 14 weeks from the day we receive the fully completed application form.
For further details view our Equity Release Guide (pdf).
Here are some of the facts you need to know about our Lifestyle Flexible Option plan.
| Criteria | Min/Max | Detail | Notes |
|---|---|---|---|
| Age limits | Min age | 55 | If joint, both must be at least 55. |
| Max age | None | ||
| Property value | Min value | £75,000 | For flats and retirement properties, 75% of the property's value is used when calculating the loan. |
| Max value | None | ||
| Loan values | Min loan | £10,000 | The client must be able to set up a minimum total reserve of £15,000, of which at least £10,000 must be taken straight away. |
| Max loan |
£600,000 |
Larger loans are considered on request. | |
| Loan to value (LTV) | Min age 55 |
Max LTV 13% |
Find out more information about our LTVs in our Equity Release Mortgage Guide (pdf). |
| Age 90+ |
Max LTV 45% | ||
| Cash reserve | Min withdrawal | £5,000 | Cash reserve is fixed at the maximum LTV at outset of the plan. If the remaining reserve is less than £5,000 it must all be taken at the next withdrawal. |
| Max withdrawal | None | Clients can withdraw as much as they like as long as sufficient funds are available in the reserve. | |
| Max number of withdrawals | None |
There is no limit to the number of times a clients can withdraw from the reserve as long as sufficient funds are available. | |
| Residency |
Property must be in England, Wales, Scotland or Northern Ireland except the Channel Islands and the Isle of Man.Property must be main residence and must meet our property criteria.If property is leasehold, the lease must have a minimum unexpired term of 160 years, minus the age of the younger borrower. | ||
Here are the commission and charges for our Lifestyle Flexible Option plan.
| Type of charge |
Detail | Notes |
|---|---|---|
| Interest |
Calculated on a daily basis and compounded annually. View details of our current interest rates and APR (pdf) .
| |
| Arrangement fee | £689 | Further fees will apply to additional borrowing. |
| Valuation fee | Estimated property value | Valuation fee |
| £75,000 – £100,000 | £165 | |
| £100,001 – £150,000 | £195 | |
| £150,001 – £200,000 | £235 | |
| £200,001 – £250,000 | £270 | |
| £250,001 – £300,000 | £295 | |
| £300,001 – £350,000 | £320 | |
| £350,001 – £400,000 | £345 | |
| £400,001 – £450,000 | £370 | |
| £450,001 – £500,000 | £395 | |
| £500,001 – £600,000 | £485 | |
| £600,001 – £700,000 | £565 | |
| £700,001 – £800,000 | £655 | |
| £800,001 – £900,000 | £745 | |
| £900,001 – £1,000,000 | £835 | |
| £1,000,001 and over | Available on request | |
| Re-inspection fee | £60 | If the home needs to be re-inspected again – for example after essential repairs have been carried out |
| Re-booking fee | £195 | To guarantee the interest rate for a further 14 weeks if the application doesn’t complete within the initial 14 week period. |
| Early repayment | There may also be a substantial early repayment charge if the loan is repaid for any reason other than death or the need to move into long-term care. There may also be an administration fee - for full details please see the Tariff of charges (pdf). | |
| Legal fees |
The customer is responsible for paying our legal costs as well as their own. Full details of these costs can be found in the Tariff of charges (pdf). | |
| Commission | 2% of the initial loan plus 0.67% of the reserve (up to a maximum of £500). | |
Here is some information to help you decide if our Lifestyle Flexible Option plan is right for your client.
| Designed for customers who | Not designed for customers who |
|---|---|
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| Consider | Potential Alternatives |
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Here are some examples of the support we offer you and your client on our Lifestyle Flexible Option plan.
Giving advice
We have produced a Getting started with equity release guide (pdf) to help advisers who want to do business in this market. It details the steps you have to take to become fully qualified.
In order to advise on equity release you must obtain an ER1 certificate. For more information about the certificate and to download the learning material go to the Chartered Insurance Institute's website
.
Alternatively, you can contact them on:
Tel: 0120 8989 8464*
Fax:0120 8530 3052
Email: customer.serv@cii.co.uk
* Calls may be monitored and/or recorded
Contact us
Risk and Retirement support team
Risk and Retirement support team can help you with any technical, marketing and other pre-sales queries on our lifetime mortgages. The team can provide you with:
- Quotes
- Literature
- Sales ideas
- Management of new business issues
- Full sales support function on-site
If you don't have an agency with us they can also send you an Agency Request Form.
We have a wide range of support staff available to help you, view our contact details to find the right number that meets your needs.
WA11003 10/2011