More2life has introduced a lifetime mortgage with rates determined by a client’s ability to make payments each month.
Flexi Interest Reward is a feature of More2life’s Flexi lifetime mortgage which offers low, personalised interest rates.
According to the lender, the product can “significantly” reduce the client’s cost of borrowing over the loan term.
More2life CEO, Dave Harris, said: “We continue to look at the ways by which we can offer bespoke solutions to lifetime mortgage customers, not least so they have full control over the payments they make and certainly on the discounts they receive, allowing them to manage their finances much more effectively.
“Flexi Interest Reward does all this, and then some, allowing the adviser to assess affordability and, in a first for this sector, allows them to secure personalised pricing at that moment in time, in order to ensure we can provide as competitive a rate as possible.”
The interest rate discount available to each Flexi Interest Reward client is bespoke.
The payment schedule is based on how much a client wants to pay and for how long, and is in place for life as long as all payments are made.
At time of launch, rate discounts typically range between 0.05-0.75 per cent.
Clients can choose to pay more than 100 per cent of the plan’s monthly interest and typically would receive a bigger interest rate discount for doing so.
Clients can also choose to make overpayments to help further reduce the cost of the borrowing; monthly payments and overpayments combined are allowed up to 10 per cent of the initial loan amount each year during the early repayment charge period.
Available to clients aged between 55 and 82 plus 364 days, Flexi Interest Reward comes with a maximum LTV of 48 per cent, has an ERC period of 15 years, and meets the Equity Release Council standards for lifetime mortgage products.
This means the client has security of tenure for life, they will never owe more than their home’s value, and they will always know their rate, which is fixed for the entirety of the plan providing they make all payments.
tom.dunstan@ft.com
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