The Mansfield Building Society has raised the maximum LTV available to borrowers aged over 65 years old on its Retirement Interest Only (RIO) products.
The Society’s five-year discounted rate and three-year fixed rate RIO mortgages will now allow borrowers over 65 to access the equity in their homes up to a maximum of 55% LTV.
Both mortgages allow additional drawdowns after the initial loan has been advanced, enabling borrowers to take the equity they need and providing flexibility so that – as long as they remain within the overall maximum LTV – they can take out more at a later date.
The Mansfield launched its RIO proposition last year, providing mortgages to older homeowners with the advantages of equity release but without interest ‘roll up’ eating into their equity.
RIO mortgage borrowers repay the interest on the mortgage to ensure the mortgage debt does not increase – the capital balance of the mortgage is cleared either upon sale of the property, or when the final surviving borrower moves into long-term care or dies.
To ensure borrowers receive appropriate advice, access to The Mansfield’s RIO mortgages is only available through qualified advisers holding the CeReR or CertER qualification.
Both RIO mortgage products are also available to borrowers over 55 years of age with a maximum LTV of 40% for those younger than 65.
Paul Lewis, national development manager at the Mansfield, said: “We launched our RIO range last year with a maximum of 40% LTV for all and, following conversations with our broking partners and borrowers, have now decided to raise this to 55% for borrowers over 65.
“By allowing borrowers to take additional drawdowns when needed, we believe our products provide added flexibility, enabling borrowers to remain in control of their finances over the longer term.
“This area of later life lending is clearly growing and we will continue to work actively in this space, developing mortgage solutions that meet real life circumstances and borrowers’ evolving needs in later-life.”