Enhanced lifetime mortgages are becoming slightly more popular in the equity release market as they offer several unique features and incentives for those retirees who have certain health conditions. The Aviva Enhanced Lifetime Mortgage has become very popular since 1998 within this particular niche of lifetime mortgages. Aviva offers an impressive range of products for retirees and this lender is authorised and regulated by the Financial Conduct Authority. Furthermore, Aviva is also a member of the Equity Release Council.
Like other enhanced lifetime mortgages, Aviva offers an extra high lump sum over & above its standard equity release loan-to-values. However, Aviva have also turned the tables on this market by applying enhanced terms to its flexible lifestyle mortgage plan. Here, if qualifying poor health can be proven, then its not the maximum lump sum that can be gained, but a lower interest rate, even lower than the standard terms would offer. Therefore, it’s a win-win scenario with Aviva should you be looking for the maximum equity release lump sum, or the lowest equity release interest rate.
Firstly, let look at the maximum enhanced release of equity with Aviva.
This plan offers its homeowners the security of knowing that they can receive a higher amount of equity based on their health and lifestyle conditions. With this particular product, homeowners are offered a single cash facility via its lump sum max product. This facility is based on health records, the property owned by the homeowners, and the homeowner’s age and health. The enhanced lifetime mortgage offered by Aviva does not have to function on its own, either. Aviva allows homeowners to also use other incentives and features alongside the enhanced lifetime mortgage. For example, if a homeowner is concerned about their ability to leave behind an inheritance to their beneficiaries, they can include an inheritance protection option with their enhanced lifetime mortgage. Additionally, with the enhanced plan there is still the options of a free valuation and upto £1,000 cashback if required. Because of this flexibility, Aviva’s enhanced lifetime mortgage plan is becoming increasingly more popular.
By using the enhanced option offered by Aviva, homeowners are able to release an additional lump sum amount based on their ill-health. So, essentially Aviva is giving more money to those homeowners who suffer from certain health conditions and lifestyle conditions. The premise behind this additional lump sum is that the homeowner will live a shorter life because of their particular health ailments. This means that the worse the conditions, or the worse the impairment, the more money the homeowner is likely to receive from their enhanced lifetime mortgage plan.
Secondly, the enhanced option can lower the equity release interest rate. Therefore, again by completing a health & lifestyle questionnaire, if certain ailments qualify for enhancement Aviva will reduce the interest rate accordingly. Where before the interest rate on the standard terms was 4.72%, Aviva will reduce the interest rate to 4.67%, should enhancement be applied. Over the years this saving in interest rate could make considerable difference.
These Aviva Lifestyle products are available to those homeowners who are over the age of 55. The interest rate is fixed for the lifetime of the loan. The enhanced plan is available to those homeowners who reside in Scotland, Wales, England, and N. Ireland and who own a home that has a minimum valuation of at least £75,000. The homeowner must be willing to borrow at least £10,000 with this particular product. Other features can be used in tandem with this product, such as the inheritance protection option.
This product is perfect for those consumers who are looking to enjoy their retirement the best way they can. By receiving additional funds, or lower interest rate the homeowners can free up some cash to spend on whatever they want over the course of their retirement years.