Canada Life Lifetime Mortgage options
Canada Life offer six types of lifetime mortgage however two are for people with second homes. Therefore for the purposes of this review, we will concentrate on the other four options which are as follows:
- Lifestyle Options
- Prestige Options
- Interest Select Options
- Voluntary Select Options
The four lifetime mortgage options are designed to offer flexibility, the ability to pay back some of the interest on a regular basis or as and when you like.
This lifetime mortgage offers a single tax free cash lump sum of between £10,000 to £1 million dependent on your age and the value of your property. There is flexibility to include an inheritance guarantee that will ensure you leave a percentage of your estate to family and a cash reserve facility for future borrowing.
The Canada Life prestige option is for customers with higher borrowing requirements and properties valued between £500,000 to £6 million. You can release £250,000 to £2 million of equity and there is an inheritance guarantee option as well as a cash reserve facility, as with the lifestyle options.
Interest Select Options
With this type of lifetime mortgage you can release between £10,000 to £750,000 of equity with the option to pay off some or all of the interest, depending on your requirements. In addition to the cash reserve and inheritance guarantee features that are available with the other Canada Life lifetime mortgages, you can choose to pay between 50% to 100% of the interest, for between 5 years and the life of the plan.
There is the flexibility to miss three non-sequential interest payments and the option to stop making the payments altogether, at which point it becomes an interest roll up scheme where the loan plus interest is paid off once you property is sold.
Voluntary Select Options
This lifetime mortgage works in a similar way to the interest select options however the payments you make are on more of a voluntary basis rather than fixed. You can choose to make a contribution of up to 15% of the initial loan every year, or unlimited voluntary contributions with a minimum amount of £50.
The Canada Life lifetime mortgage options included in this review also offer the following:
- No Negative Equity Guarantee – which means your estate will never owe more than the price the property is sold for.
- Additional borrowing – a feature with all of the schemes that lets you borrow further amounts in the future, subject to the lending criteria at the time of the application.
- Cash Reserve & Inheritance Guarantee – gives you the flexibility to only drawdown the money you need and have a cash sum in reserve, which in turn will reduce the interest you pay and the ability to ensure a percentage of the property value is left as an inheritance for family.