Option A – Interest Only Mortgage

Mrs Jones could borrow the £20,000 cash lump sum via an equity release interest only mortgage.

One plan currently available has a lifetime fixed interest rate of 6.23% (The overall cost for comparison is 6.8% APR). This loan requires a monthly repayment of £107. If these payments are maintained for the life of the loan then the initial amount borrowed will never increase. The loan will only be repaid when the house is sold either as a result of death or the need for permanent long-term care.

This plan does not have a further borrowing facility so we cannot guarantee that Mrs Jones will be able to borrow any additional funds in the future.

If this loan were redeemed after 18 years then the total amount to be repaid including the original loan would be £43,689.

This is an equity release plan. To understand the features and risks, ask for a personalised illustration.