Enhanced Lifetime Mortgages fall within the category of equity release mortgages for people in or nearing retirement. Like standard equity release lifetime mortgages, the purpose of the mortgage is to release equity from the owners property which they can use to finance their retirement or other necessary or desirable requirements.
What makes Enhanced Lifetime Mortgages different to the regular equity release mortgages you see more typically referred to, is that the “Enhancement” refers to being able to release more equity than is typically allowed.
The reason property owners can release more equity using an Enhanced Lifetime Mortgages is due to the lender taking in a wider range of lifestyle and health considerations, and if these make it likely that the property owner is not likely to stay in the property for as long as the typical average, then the mortgage lender may allow additional equity to be released (this is because the amount of overall interest payable will be less, if the duration of the mortgage is shorter).
An enhanced lifetime equity release plan potentially offers more capital to be released from the property, as it is based on your specific health and lifestyle conditions. What this effectively means is – if you have a health condition, concern or long term illness, then this makes it quite probable that you will not reach the UK average life expectancy for a person who does not have these conditions. This makes is much more likely that you will be accepted by an equity release mortgage lender on to one of their enhanced equity release plans.
Will I be entitled to an enhanced lifetime equity release plan?
It is estimated that over 50 percent of customers will qualify for this type of plan, but far fewer actually apply. This is because most people don’t realise what type of conditions are considered.
Having an illness, disease or other health concern likely to result is you not living as long as the national average may seem a very crude way of looking at Enhanced Equity Release, but it is also a very practical one – and for once plays to the advantage of the person who would otherwise be at a significant disadvantage – now how often does that happen?
