Equity release

Lifestyle Lump Sum Max

Helping your clients live life to the full

Using Lifestyle Lump Sum Max, your client can borrow £15,000 or more tax-free with a fixed rate lifetime mortgage. The amount available depends on their age and the value of their property. No repayments are normally needed, as the loan's usually repaid in full from the sale of the property when your client dies or moves into long-term care, subject to our terms and conditions. 

Enhanced rates

Certain health or lifestyle conditions mean a lower interest rate or higher loan to value

Home security

Your client still owns their home and can live there until they die or move into long-term care

Be aware

The amount owed can quickly increase, which will reduce the amount of inheritance your client can leave

Product details

Why Lifestyle Lump Sum Max?

Our Lifestyle Lump Sum Max is a fixed rate lifetime mortgage that pays a tax-free lump sum of £15,000 or more to your client. Your client will still own their home and can live in it until they die or move into long-term care subject to our terms and conditions. This applies to both borrowers on joint lifetime mortgages.

As a one-off lump sum, Lifestyle Lump Sum Max can be particularly suitable if your client has something in mind to use the money for - like home improvements, or to give children or grandchildren a helping hand.

Your clients should be aware that during the mortgage term, interest is charged on the amount borrowed plus interest already added, which can quickly increase the amount owed. They won't have to pay tax on the amount they release, but it may affect their tax position and eligibility for certain welfare benefits. It will also reduce the amount of inheritance they can leave.

 

Great benefits as standard

  • Your client receives tax-free cash to spend as they choose
  • No need to make any repayments during the term of the lifetime mortgage under normal circumstances (terms and conditions apply)
  • Interest rates are guaranteed for 14 weeks from when we get the application form
  • No upper age limit - anyone aged 55 or over can make use of the equity in their home
  • Online access - you and your client can see up-to-date policy details 24/7
  • Downsizing protection is a standard product feature which allows a client to move to a property that doesn't meet our lending criteria and repay their lifetime mortgage in full without paying an early repayment charge (terms and conditions apply)

Peace of mind

  • No-negative-equity guarantee - your client (or their estate) won’t have to pay back more than the property sells for, as long as it's sold for the best price reasonably obtainable
  • Optional inheritance guarantee - your clients may be worried that the inheritance they leave will be reduced, but this guarantee allows them to safeguard a percentage of their home’s value
  • Voluntary partial repayment - allows your client to repay 10% of the initial amount borrowed. If the client borrows more they can also repay up to 10% of those amounts each year
  • Moving-home option - your client may be able to transfer their lifetime mortgage to a new home as long as it meets our lending criteria at the time
  • Your client may be able to borrow more in the future, though we can’t guarantee this and again it would depend on our lending criteria at the time

Enhanced rates

  • Clients with certain health or lifestyle conditions could benefit from lower rates of interest or a higher loan to value

Facts and figures

 

Limits

Additional info

Age

· Minimum age 55

· No maximum

· For joint policies both applicants must be at least 55

Property value

· Minimum value £75,000

· No maximum

· With flats and maisonettes, 85% of the property’s value is used when calculating the loan

Loan amount

· £15,000 to £600,000

· We consider larger loans on request

Loan to value (LTV) – single applicant

· Minimum 20.5%, minimum age 55.

· For clients aged 85 and over the maximum LTV is 52%.

 

· For more information about our LTVs (including possible enhanced rates which depend on your client’s health and lifestyle), read our adviser guide

Loan to value (LTV) – joint applications

· Minimum 19.5%, minimum age 55 (based on the youngest person).

· For clients where the younger person is aged 85 or over the maximum LTV is 51%.

Voluntary partial repayments

· Minimum £50

· Maximum 10% of total amount borrowed

· Each year clients can repay up to 10% of the amount they've borrowed. If your client borrows more at a later date, they can also repay up to 10% of each of those initial loan amounts each year. The minimum they can repay in each installment is £50.

· Only available to clients who applied for their lifetime mortgage from 28 April 2014 onwards

Early repayment charge

· Maximum 25% of each amount borrowed

· This may be charged if a client wishes to repay the loan in full before they die or move into long-term care. The charge will apply to each amount the client has borrowed. The charge doesn’t apply in certain situations – see terms and conditions for details

· For joint applicants who applied for their lifetime mortgage from 28 April 2014 onwards, there is no early repayment charge on first death

Residency

 

· The property must be in England, Wales, Scotland or Northern Ireland (it can’t be in the Channel Islands or Isle of Man). It must be your client’s main residence and must meet our lending criteria. If the property is leasehold, the sum of the years remaining on the lease plus the age of the youngest borrower must equal at least 160 years

Fees and charges

Here we summarise some of the charges and fees your clients may need to pay. For full details please download our Tariff of Charges.

Charge

Details

Interest

Calculated daily and compounded annually.

Arrangement fee

Shown in your client’s Key Features Illustration

Early repayment charge

May apply if the loan is repaid for any reason other than those mentioned in our terms and conditions. The charge could be up to 25% of the loan value, including any additional borrowing. There may also be an administration fee.

Legal fees

Your client is responsible for paying their own legal fees. Aviva's legal costs and any disbursements are covered by the arrangement fee.

Commission

2.25% of the initial loan.

Revaluation fee

If an application takes more than 6 months to process, your client will need another property valuation. 

Reinspection fee

£60 if the home needs to be inspected again - for example after essential repairs have been carried out 

Additional borrowing fees

Please download our additional borrowing brochure for applications from 28 April 2014 onwards.

Valuation fees

Property value

Valuation fee

£75,000 to £150,000

£153

£150,001 to £300,000

£210

£300,001 to £500,000

£295

£500,001 to £750,000

£480

£750,001 to £1,000,000

£685

£1,000,001 to £1,100,000

£920

£1,100,001 to £1,200,000

£1,120

£1,200,001 to £1,500,000

£1,270

£1,500,001 to £2,000,000

£1,420

Over £2 million

Please contact us for more information

Client suitability

Lifetime mortgages are one solution to a number of wider issues facing customers and the UK in general, including, for example:
  • Helping a younger generation struggling to get onto the housing ladder – releasing value locked in older generation's houses
  • Quality of life – remaining in their own home and staying independent is a key aim, with home adaptations and paying for care beyond that provided by the state
  • Sourcing of later life borrowing where traditional mortgages are not an option – for example to replace interest only mortgages where no repayment vehicle is in place

Lifestyle Lump Sum Max is designed for clients who:

  • Are homeowners aged 55 or over who need to raise capital
  • Have no mortgage or can pay off their mortgage with the proceeds of the loan
  • Have a minimum property value of £75,000
  • Need to borrow at least the minimum £15,000
  • Require a fixed rate of interest throughout the term of the lifetime mortgage
  • Live in the UK (excluding the Channel Islands and the Isle of Man)

It’s unlikely to be suitable for:

  • Clients who have savings or other money they could use first
  • Those who would prefer to use a product that lets them release cash by selling all or part of their home
  • Those who already have a large mortgage they couldn’t pay off with the proceeds of the loan
  • Clients who’d prefer to sell their property and downsize

Things your clients should consider:

  • Involving their family in the decision
  • For couples, ensuring both borrowers understand the commitment
  • The impact on their state and welfare benefits
  • Whether releasing equity could affect their tax position
  • How releasing equity will reduce the amount of inheritance they can leave
  • Ensuring they’re prepared to commit to this for life, as early repayment charges could be expensive
  • Understanding the costs involved, particularly the build-up of interest over the term of the lifetime mortgage

Possible alternatives to equity release include:

  • Selling or using other assets
  • Local authority or other type of grant
  • Taking out a standard secured or unsecured loan, if your client can afford the repayments
  • Selling their home and downsizing
  • Adjusting their standard of living
  • Moving in with children
  • Borrowing money from family
  • Selling part or all of their home using a home reversion plan

Quote and apply

Pre-sales support:

For New business and Additional Borrowing Quotations and Pre-Sales Lending Criteria Enquiries:

Email: equityreleasefapresales@aviva.com

Phone: 0800 015 4909

Submitting new business: 

New Business Applications: nbapps@aviva.com

Additional Borrowing Applications: erab@aviva.com

New Business Updates:

For all enquiries relating to submitted applications and client(s) offers:

Email: lpeqren@aviva.com

Phone: 0800 206 2014 Option 2

Existing Business:

Redemption Statements, Reserve Drawdowns, Change in Circumstance, Moving home, LOA

Email: ercicdirect@aviva.com

Phone: 0800 206 2014 Option 1

Business Support:

Request a call back from your regional Business Development Manager:

Email: erbusinesssupport@aviva.com

Agency & Commission:

For all enquiries to relating to agency codes and commission:

Email: ACINFO@Aviva.com

Phone: 0800 015 0967

 

Calls to and from Aviva may be recorded and/or monitored. 

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Pension Portfolio on the Aviva Platform offers both single and phased flexi-access drawdown, giving your clients complete flexibility with their pension fund in retirement.

Lifetime Care

For clients who need long-term care for a physical disability or mental impairment. Our plans help to fund care fees for people either currently receiving care or about to receive care.

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