Just Retirement  

Just launches flexible lifetime mortgage

Just launches flexible lifetime mortgage

Just Group has launched a lifetime mortgage offering additional flexibility including tiered interest rates and a cash facility. 

The Just For Your Lifetime Mortgage, launched today (January 14), gives borrowers the option to pay some or all of the monthly interest amount with minimum interest-serviced payments set at £25.

Those paying interest will receive a reduction to the roll up interest rate of up to 30 basis points dependent on the amount being paid. 

In addition, customers are able to take up to three months payment holidays in each policy year and can access a cash facility if they don’t take the maximum loan-to-value at the outset. 

Paul Turner, managing director, retirement lending at Just Group, said: "Lifetime mortgages are undoubtedly one of the most exciting parts of the financial services market and a key growth area for advisers as people increasingly seek out more holistic ways to use their wealth, including their property wealth, to meet their objectives, whether that is to provide retirement income or capital, pay for care or pass on to beneficiaries."

He added: "For those who at the outset decide to repay some or all of the interest, the potential savings over the lifetime of the loan can be huge.

"The tiered rates provide an incentive for borrowers to make interest payments and the reduction in interest payment is a unique feature in the market.

"Customers making interest payments on the main loan also have the option to do so on any additional borrowing."

The reduction to the roll up interest rate is tiered based on the amount of interest a customer choses to pay:

Up to 25% - 1bp reduction off the roll up interest rate 
Up to 50% - 10 bps reduction 
Up to 75% - 15 bps reduction 
Up to 100% - 30 bps reduction 

Craig Parkinson, mortgage and protection consultant at Continuum, said: "This seems to be very similar to the Legal & General offering that they have had for a year.

"The main differences are the fact that Legal & General have no flexibility –if you miss six payments across the whole term then they will move you onto rolled up interest. They also do not give you a better rate if you choose the ‘serviced’ option."

He added: "Another lender in the market that offers a ‘serviced’ lifetime mortgage, which on the face of it seems to offer a lot of flexibility, can only be a good thing for the adviser and the client."

Will Hale, CEO at specialist adviser Key, also welcomed the launch. He said: "Today’s product changes from Just are to be welcomed as they have taken a holistic view of their offering and introduced some innovative new features.

"Introducing the option to repay some or all of the interest on an ongoing basis as standard is to be applauded as we are seeing an increasing number of customers who are looking for flexibility in how they manage their lending into and in retirement."