Are you a mortgage Prisoner?

True Cost Mortgages – Mortgage Broker Liverpool.

There has been a lot of talk in recent years of mortgage prisoners, these are mortgage holders who for various reasons can’t switch mortgage providers, so they are stuck on their lenders variable rate. These rates can be more than double open market rates, so this is not a great position to be in.

A lot of these borrowers took out interest only mortgages before the credit crash and as the mortgage market contracted the interest only draw bridge was pulled up by most lenders.

As this group of borrowers get older many are approaching the end of the mortgage term and are left with very few options and have to downsize which may not be ideal. Thankfully the mortgage market has developed in recent years and lenders are now waking up to the opportunity that many of these borrowers need a solution.

Introducing the Retirement Interest Only mortgage (RIO). This mortgage is designed so borrowers can remortgage to a new lender which will then allow a longer mortgage term. This will allow the borrower to stay in their home until they die or move into long term care. This takes a lot of stress away and they can continue to enjoy the home they love.

The borrower can set this new mortgage on an interest only basis or capital and interest so there is no roll up of interest that is associated with equity release. The interest rates are also a lot lower, so this is a real alternative for borrowers to consider.

The mortgage is available up to a maximum age of 80 at application and there is no maximum term so as mentioned earlier they will never have to sell the house to repay the mortgage unless they die or move into long term care.

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