Hodge Lifetime has perhaps the strongest and most reliable reputation of all lenders in the equity release market. In fact, Hodge Lifetime is regaled as being the creator of equity release schemes, having funded the first one’s back in the 1960’s. The Flexible Repayment Plan offered by Hodge Lifetime does put a rather unique spin on the original lifetime mortgage scheme.
With the Flexible Repayment Plan, the whole amount borrowed does not need to be taken straight away. A smaller amount can be borrowed up front and immediately while simultaneously securing a cash reserve that can be drawn from in the future if needed. This ensures that there isn’t more money borrowed at the outset than is actually needed. By borrowing only what is necessary, not only is the amount borrowed less but the interest accrued over time will also be less. That initial amount borrowed will have a fixed interest for the term of the loan.
This product offers a unique feature not found with many other lifetime mortgages. With this product, 10% of the original loan amount along with 10% of any future withdrawals can be paid back each year without incurring any early repayment fees or charges. This repayment feature alone can make this product quite different than other lifetime mortgages. For those who are looking to lessen the final amount owed at the time of repayment, this is one of the very few drawdown plans that will allow for early repayments without charge. This could lead to leaving behind a larger inheritance since the amount due at the time of sale will be less if payments have been made over the course of the loan.
While early repayment charges are more easily avoided with this product, they can still be incurred. For example, if the residence is moved from within the first 5 years of the lifetime mortgage, the lender charges a penalty that reduces over time. This charge begins at 5% and decreases by 1% over the first five years. However, for those who decide to move residence after the first five years, there is a safeguard in place. If the move takes place after the first five years of the product, the entire loan can be repaid. These repayment charges, for both instances, apply only when moving. There are other repayment charges that can be incurred when a move in residence does not take place.
With unique repayment features and drawdown options, the Flexible Repayment Plan offered by Hodge Lifetime can put a very unique spin on the traditional lifetime mortgage scheme.