OneFamily has added two new flexible interest-paying products to its lifetime mortgage range.
Consumers will be able to choose how much interest they want to pay, and for how long. They can also opt for a fixed or a variable interest rate.
Lifetime mortgages can often be taken out by parents or grandparents looking to raise the money for deposits on houses for children and grandchildren. The mutual has said that it will work flexibly across the generations to help families achieve their financial goals.
The new products include the following:
| Lump Sum Interest Payment Lifetime Mortgage – Variable Interest Rate | ||
| Lite LTV | Standard LTV | |
| Interest rate MER (current) | 3.50% | 3.70% |
| Interest rate AER (current) | 3.56% | 3.76% |
| Lump Sum Interest Payment Lifetime Mortgage – Fixed Interest Rate | ||
| Lite LTV | Standard LTV | |
| Interest rate MER (current) | 5.18% | 5.37% |
| Interest rate AER (current) | 5.30% | 5.50% |
Georgina Smith, OneFamily managing director, said: “Our new products mean consumers can repay up to 100% of the interest on the loan at either a variable or fixed interest rate, in the same way you would with a mainstream interest only mortgage.
“Obviously with variable interest rates there is the risk that the monthly payments may change in the future. However, OneFamily has considered this and gives consumers the option to fix their maximum monthly interest payment, even if they have a variable interest rate.”
If the consumer chooses to fix their monthly maximum interest rate and if interest rates increase above the agreed figure, any additional interest will be added to the original loan and would be paid back at the end of the term.
Smith added: “We have included the option to make payments at a set percentage of the interest due or a set amount, and consumers can also choose to stop making the payments if their circumstances change. At this point they will have the choice to switch to one of our other lifetime mortgages, such as our interest roll-up or voluntary payment products.”
These will also be the first lifetime mortgage products to be added to the approved lenders list of the Mortgage Intelligence network.
Sally Laker of Mortgage Intelligence said: “We have been one of the UK’s leading mortgage networks for many years because we strive to offer our brokers intelligent, flexible solutions.
“By adding OneFamily’s new lifetime mortgages to our panel, we are keeping our advisers ahead of the curve and providing them with the best products for their clients.”