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Welcome to RNS Financial Advisers Ltd

Independent Financial Advisers in Scunthorpe, North Lincolnshire

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01724 842 713

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Lifetime Mortgage

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The range of retirement planning solutions has expanded with the introduction of Lifetime Mortgages.

What is a Lifetime Mortgage exactly?
A Lifetime Mortgage is a specialist type of mortgage available to people over 55 with their own property.

It is different to a conventional mortgage because affordability is not based on income, so it can be used by people who have retired.

The amount you can advance depends on your age, usually the older you are the more you can advance.

You can repay the loan or there are various interest only options, usually with a fixed rate of interest for life.

Lifetime Mortgages are fully regulated and there are a growing number of financial planning opportunities that can be realised by releasing some of the equity in residential property, especially with the combination of low interest rates and high property values.

The Loan and Interest
The loan and interest can be a monthly repayment of capital and interest; monthly repayment of interest only; or pay nothing and have interest rolled up until the property is sold. Interest rates are fixed at the outset so you know exactly what the cost will be.

Loans can be for between 31% and 58% of the property value depending on your age. They are available from age 55, where the maximum loan can be up to 31% of the property value. There is no upper age limit.

Loans can also be flexible and work like a drawdown facility, so you only pay interest on what you use.

Some of the situations we have seen where releasing equity with a Lifetime Mortgage can be beneficial include:

  • Reduce Inheritance Tax; release money from the home for giving to family now
  • Maintain lifestyle when ‘asset rich and cash poor’
  • Mitigate Capital Gains Tax; raise funds without selling assets
  • Care planning
  • To defer Pension and SIPP drawdown and retain Inheritance Tax reliefs
  • Release money to help children and grandchildren onto the property ladder
  • Raise money to invest in your business or to help a family business
  • To bridge a shortfall and move or downsize without selling straightaway

Able to retire
Mrs A was 63 and had lived in her property for the last 32 years, the first 27 years of which were with her husband who had sadly passed away five years ago. Due to insufficient pension provision and little in the way of savings, she was still having to work and was desperate to retire. With costs rising, she saw no other option but to downsize from her existing property that she loved and was full of memories. But instead, she was able to release some of the equity from her property by means of a Lifetime Mortgage and this meant she could afford to retire without having to sell her home or cut back on her standard of living.

Gift for grandson
Mr & Mrs E were in their early 60s and had one daughter and one grandson. Their grandson had recently finished his education and had started full time employment and was desperate to buy his own home with his girlfriend who had just become pregnant. Due to the cost of houses in the area, they couldn’t foresee being able to save the deposit they needed for a property for many years to come. Mr & Mrs E, who owned their property outright, released sufficient equity from their own property to be able to give their grandson enough money for a deposit on a property.

Holiday fund
A couple in their late 50's, had for many years dreamed of going on a cruise around Scandinavia. Despite trying hard to save, something had always cropped up and they had to use their savings and were left starting again. They were concerned that they wasn't getting any younger and that by the time they had managed to save the amount needed, they may not be able to do it due to health reasons or even worse. They released some of the equity from their property. Later that year they were on an exclusive cruise ship, sailing around the Scandinavian coastline. They were even able to budget for future holidays with a reserve facility built into their plan which would also serve as an emergency fund if required.

Mortgage in retirement
Mr and Mrs F had been loyal clients of a major high street bank for more than 20 years. They had sold their business and retired early and lived off their investment income. They wanted to move and increase their mortgage, which they could easily afford to service. But then they were told they could not extend their mortgage at all and, in fact, they needed to repay the existing mortgage within a few months or face dire consequences. Being retired, even though they had investment income, they could not pass the high street bank’s narrow and restrictive affordability test, even though their income was pretty good. Instead, they were able tore-finance to a Lifetime Mortgage with affordable Interest Only payments at a fixed rate and are actually in a better position than previously, especially knowing the new mortgage rate would be fixed for life.

Home improvements
Mr C, a single and very house proud man was 78 years of age. All of his life he had maintained his property himself, but due to medical conditions, this was becoming more and more difficult to do. Over recent years his home had become a little neglected and this was really getting him down as he loved to have his home looking nice. With an income that was just sufficient to pay the monthly bills and provide a modest standard of living, he couldn't afford to get any help with maintaining his property, but with no children to leave it to, released enough equity so that he could have his whole home re-decorated and brought back to the standard that he had kept it at himself before his health had deteriorated.

Please speak to your usual partner or one of our financial advisers if you would like to make an appointment.

RNS does not give advice on Lifetime Mortgages directly and we will refer you to a qualified adviser from outside our group. We may receive a referral fee. Meetings are available with no obligation for clients, family and friends, in our offices, over the telephone or by video call.

Welcome to RNS Financial Services Ltd , Independent Financial Advisers in North Lincolnshire

We have years of experience, providing support to generations of families.

With offices in Scunthorpe, Brigg and Barton, we are visible and accountable. Partner Andrew Clayton said: Localness is key to our success.

While face-to-face meetings were limited during lockdown, video conferencing has provided clients with a reassuring face.

We have adapted like every other business.

Fellow partner Alex Douglas said while it had been a difficult period, now was a good time to invest.

We have always been big advocates of investing early in the financial year and using as many tax allowances as you can. There is a general acceptance the Government may need to make changes to taxes before long, the case looks even more compelling.

Tax-efficient saving is key to successful investing. Paying more tax than you need to or forgoing allowances can lower the amount of money you have in the future.

So, with such products as pensions and ISAs, the earlier you use your allowances every tax year, the more time you have to reap the rewards.

Andrew and Alex are qualified chartered accountants as well as holding diplomas in Regulated Planning Services, the benchmark qualification for advising on retail investment products.

They are joined in the team by Jayne Mumby and Catherine Snell, who hold the same qualification and are also qualified accountants.

Aiden Boucher, studying for his diploma, and Karen Graves also support the team.

Andrew said the team was good at listening.

It is where it all starts.

We listen to clients needs, and we formulate a plan, which enables us to offer clear, no-jargon advice on the most appropriate financial products for their personal circumstances.

Call us today on 01724 842713 or complete our short enquiry form and we will be pleased to help you.

 

ABOUT RNS Financial Advisers

Who we are and what we do

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RNS Independent Financial Advisers are backed by the partners of the long established regional accountancy firm RNS Chartered Accountants.

It means we can offer financial solutions that a traditional IFA can but also provide the breadth of knowledge and tax expertise afforded by advisers who are also qualified accountants.

We encourage prospective clients to arrange a free initial consultation at our offices in Scunthorpe, Brigg and Barton or at your home or place of business.

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Our Main Products

  • Savings & Investments

    There are many different ways to save, but whichever way you choose, the general idea is the same: to build up some money.

  • Life Assurance

    The main purpose of Life Assurance is to provide money for those people who may depend on you financially, in the event that...

  • Retirement Planning

    A well prepared pension plan which is regularly reviewed should go some way to providing you with a reasonable level of income in...

  • General Enquiry Form

    Click Here to complete our enquiry form

HOW WE WORK

Here's how we formulate the plan towards your goals

Many people have goals and dreams, but a goal without a plan is just a wish... an achievable goal is a dream with a deadline.
OUR PLAN FOR YOU
  • 1

  • About you

  • We meet together to discuss your personal circumstances and your current financial situation.

     
  • 2

  • Your Goals & Ambitions

  • Next we discuss your objectives and your aspirations, as well as any concerns that may arise.

     
  • 3

  • Analysis

  • We'll discuss with you our analysis of your current financial position, and outline our initial thoughts for the plan.

     
  • 4

  • How to get there

  • So now we know where you are and where you want to be.

     
  • 5

  • Implementation

  • It's time to implement the plan. Every course of action we have recommended and agreed with you is now put into motion.

     
  • 6

  • Review the Plan & Progress Updates

  • If required, review dates will be agreed and can take place annually or more regularly if required or requested, ongoing fees will be agreed as to which service level is required.