Lifetime Mortgage

MWT

Thanks, I will do that. I haven’t gone so far as to let him know I have life insurance cover, but will discuss this with him.
From reading up on this, it may not make any difference anyway as the lender may still insist a waiver is signed. I totally understand why they would want that. 

It does feel like your advisor may have failed to ask a few of the questions I would have considered to be normal before getting a mortgage offer, but either way, the lender will certainly insist on getting occupiers consent forms signed no matter what methods you may have in place for repayment.

These waivers are a very simple document and one that is often offered by low-cost online legal services so if you are asked for more than around £150+VAT for each form, I'd take a look around.  

Whiterose23

Thanks MWT, your advice is much appreciated.

whizzywoo

Whiterose23 said:

whizzywoo said:

What I will say is that the provider of the lifetime mortgage, in our case Standard Life, was extremely picky regarding the new build.  They have their own legal team who act for them and so you end up dealing with 3 lots of solicitors.  Your own solicitor, the builders' solicitor and the mortgage provider's solicitor and that does slow the process down.  Standard Life's legal team kept coming up with one query after another and it took nearly 6 months to get from reserving the house to completion and this was a new build which was fully built and ready to move into.  We ended up completing on the sale of our old house and moving in temporary accommodation whilst waiting for Standard Life to finally say they were happy!

Thanks for your response. I wonder if this reaction from the lender was specifically because you were buying a new build? In my case I would be buying an older house, probably at least 50 years old. Also my borrowing is lower at £30,000 so I wonder if that would be easier for me also?
Interesting… I do understand though, that any lender, particularly of this type of mortgage, is going to want to be absolutely sure they get their money back. Do you regret taking it out?

No we do not regret taking it out.  

I do think some of the problems with the lender's legal team were to do with the fact it is a new build.  Lots of queries re planning, covenants, management company etc.  Not so many about the quality of the build as long as it had the NHBC 10 year guarantee.

But I do think that you will face questions about the physical state of the house.  After all it is quite possible that they will end up with the house on their hands when you die, especially if you don't pay the interest on the loan.  It doesn't take long for compound interest to get to eye watering proportions.  So they don't want to be left with a house they can't sell or isn't worth enough to cover the debt.  They are looking at the worst case scenario.  They also won't lend on properties close to shops, pylons and other odd things which may put prospective buyers off in the future.

Your age may also be against you.  I think they use a formula which takes into account your age, property value and loan required.  It's a risk for them if you don't pay the interest and how long you live.

MWT

whizzywoo said:

But I do think that you will face questions about the physical state of the house.  After all it is quite possible that they will end up with the house on their hands when you die, especially if you don't pay the interest on the loan.  It doesn't take long for compound interest to get to eye watering proportions.  So they don't want to be left with a house they can't sell or isn't worth enough to cover the debt.  They are looking at the worst case scenario.  They also won't lend on properties close to shops, pylons and other odd things which may put prospective buyers off in the future.

This is very true, they look at things you might not have thought about, like 'clutter' inside the property, and things you would expect like when the outside of the property was last repainted and state of the windows/doors etc.

whizzywoo said:

Your age may also be against you.  I think they use a formula which takes into account your age, property value and loan required.  It's a risk for them if you don't pay the interest and how long you live.

It is not so much that it is 'against you' it just serves to limit the maximum percentage that you can take out of the property, which in turn can impact the interest rate if you get too close to the maximum percentage.

Given the amount the OP is looking for it is not likely to be a problem though.