The Equity Release Club, a distributor and ‘one stop shop’ for equity release advisers, has announced a tie-up with Marsden Building Society to support new mortgage products for those in retirement.
The first product available to Equity Release Club members via Marsden is a two-year discounted offering lending to customers already in retirement, where income is guaranteed and proven.
The Marsden product is available at two loan-to-value levels; 2.99 per cent up to 40 per cent LTV on an interest-only basis, and 2.79 per cent up to 60 per cent LTV on a repayment basis.
The discounted rate is available with a booking fee of £299 until 31 January 2018, alongside an arrangement fee of £299 and an early repayment charge applicable during the period.
The firms said applicants for the mortgage must be over 55 years old, up to a maximum of 85 by the end of the term, and the individuals must be in receipt of pension income.
Income from property and investments is acceptable if it is evidenced by SA302s or an annual investment statement, however, employed income is not considered.
The minimum property value is £200,000, and the product is available for purchases, remortgages or unencumbered properties.
The property has to be the applicant’s permanent main residence.
The firms said other benefits include free standard valuation, fee-assisted remortgage legals, portable products and 5 per cent of annual overpayments.
Stuart Wilson, managing partner of the Equity Release Club, said: “The area of lending to those already in retirement has been pushed up the mortgage agenda because of the fall-out from MMR and the tightened criteria and affordability that many lenders have introduced.
“This has led to many potential borrowers in this situation being unable to access the finance they want. Now, however, we are seeing certain forward-thinking lenders realise the market gap here and tailoring their offerings to those with known and provable retirement income.
“This is why we are particularly pleased to be working with the Marsden who are at the front of the lending pack with this type of product innovation. We firmly believe our members will have many clients in this predicament and therefore these lending to the retired mortgage products should find a willing audience.”
Heather Crinion, general manager for operations at Marsden Building Society, added: “We appreciate that brokers will have some questions with the portfolio being new and for those that may not have used the society before.
“We are encouraging them to get in touch and speak to our intermediary team to discuss criteria and answer any questions they may have.”