Do I qualify for an enhanced lifetime mortgage?

If you are interested in an equity release scheme, you of course want to know if you qualify. You may also want to know if you qualify for an impaired equity release, which may have the benefit of a larger lump sum payment or lower interest rate.

In general, if you are older than 55 and own your own property in the UK, you may be eligible to take advantage of an equity release scheme. Of course, confirming eligibility is a bit more complicated than that.

Criteria for qualifying is usually divided into a few different categories, all used by lenders to determine if you are a good candidate for an equity release product. The qualifying criteria includes the home’s location, the property value and condition, the age of the homeowners, the amount of the loan, and overall credit history.

For a definitive answer on whether you qualify for an impaired equity release policy, use our free smartER research tool. It will compare your personal circumstances against the lender’s product criteria to determine whether you’re eligible. Furthermore, it will show which enhanced and standard products are available to you, their interest rates, and how much money you can raise with each. Get smartER today.

Location

In order to qualify, your home must be located somewhere in the UK. There are some further restrictions that must be followed by certain lenders, as well. For instance, if you live in Northern Ireland, you would have just two options when it comes to lenders.

Property Value and Condition

Your property must have a minimum valuation of £70,000 in order to qualify for any equity release plans. For the most part, there aren’t any maximum limits imposed but that can depend on the lender.

The condition of your home will also be taken into account. It must be in good condition overall and it must be well maintained. A home that is in poor condition or that has not been well cared for can get declined by many lenders.

Homeowners’ Ages

You have to be at least 55 years old to take out an equity release plan. That is the minimum, but many lenders require a higher age, usually 60. It is the age of the youngest homeowner that is taken into account when determining eligibility.

Loan Amount

You must take at least £10,000 with any plan, but some lenders require a higher loan amount. The maximum that you are allowed to borrow will depend on a few different factors including the value of the property, your age, and your overall health. In general, the older the homeowner, the more than can be borrowed.

Credit History

There are no repayments required with equity release products. So, the criterion is a bit more laid back than you would find with products that do require repayments. Many lenders do not do a credit check at all, but that differs by lender.

Impaired Equity Release

There are further requirements you need to meet to qualify for an impaired equity release product. You must have a qualifying health or lifestyle condition. Qualifying conditions are those that typically cause a shortened life expectancy, such as smoking, high blood pressure, diabetes, or Parkinson’s Disease. You may also qualify based on your body mass index, the fact that you take prescription drugs, or if you had to retire early due to poor health.

With an impaired equity release plan, you may be able to receive a larger cash payment or benefit from a lower interest rate.