Lifetime Mortgages - and breath.................

Stung by the endowment scandal of the 80s' and 90s', there are a great number of home owners who are now facing the tricky decision on how an earth they are going to pay off their mortgage. For many taking their head out of the sand is a huge shock and for many only ends up in them sticking their head back in to the sand in the hope that their numbers come up in the lottery. When you combine this with a need to create an income because they have not saved for their retirement and the bank asking awkward questions about how you are going to pay off the mortgage - this is the perfect storm.

Equity release is sometimes seen in these circumstances as the magic bullet. The problem is that if you make the wrong decision it is very difficut to reverse. A more palatable solution which gives you a chance to collate a longterm flexible solution is a lifetime mortgage. This will give you an opportunity of continuing on with your interest only mortgage for as long as you pay the interest. The idea is that the lender will get paid when the property is sold.

The pros are that you are not forced into selling your property at the moment, you can capital raise and you will have access to some pretty competitive fixed rates. The downsides are that you need to pass the usual affordability tests and the lender will only want to lend you 35% of the value of the property!

Listen. It's not going to suit everyone but surely it's better than sticking your head back in the sand!