LV has tweaked its Lifetime Mortgage Lump Sum Plus product to allow early repayments and added a downsize option.
The provider will now allow customers to make a repayment of up to 10 per cent a year from year two of the policy onwards without incurring early repayment charges (ERCs).
Meanwhile, the downsize feature means customers will not be charged an ERC should they move to sheltered accommodation or port their mortgage to a new property that does not fulfil lending criteria.
The downsize protection is included for full repayment from year five onwards.
LV’s Lifetime Mortgage Lump Sum Plus product allows people to borrow a one-off cash amount in order to fulfil a wide range of needs, such as repaying their current mortgage or providing family members with much needed help.
The provider’s equity release options come with no ERCs after 10 years, or within three years of one of a couple either dying or going into long term care.
Steve Lewis, life sales and marketing director at LV, said: “In the post-pension freedoms world, and as people are spending longer in retirement, equity release is becoming an increasing popular choice for those looking for the additional security and income the product can offer.
“We’re committed to making sure our equity release proposition is as flexible and transparent as possible to help our customers create a confident and secure future.”
Paul McKay, director at Hampshire-based Homeloan Express, said: “It is not flexible enough – you have to wait a year. Other companies allow repayments from day one.
“These people have got to put this money aside somewhere and then 12 months down the road they have got to remember to phone up and say ‘can I give you £4,000?' It is too clunky.”
simon.allin@ft.com
