Can I Pay Off a Lifetime Mortgage?

Quick Links

Can You Repay a Lifetime Mortgage Early?

Why Would You Want to Pay It Off?

How Can You Pay Off a Lifetime Mortgage?

What Should You Consider Before Repaying?

A lifetime mortgage is a long-term commitment, designed to be repaid when you pass away or move into long-term care.

While it’s intended to last a lifetime, there are circumstances where homeowners choose to pay it off early.

Whether this is the right decision depends on your personal and financial situation, as well as the terms set by your lender.

Can You Repay a Lifetime Mortgage Early?

Yes, you can repay a lifetime mortgage early, but this often comes with conditions.

Some lenders allow partial repayments, while others permit full repayment, though early repayment charges may apply.

These charges can vary depending on the lender and how long you’ve had the mortgage, so checking the terms of your agreement is essential.

Speak to an Advisor – It’s Free!

Schedule a free callback from one of our experts today.

• All situations considered
• Transparent and honest mortgage advice
• We search 1000s of purchase and remortgage deals

Get Started

Our customers rate us 4.9/5

Why Would You Want to Pay It Off?

There are several reasons why a homeowner might want to repay their lifetime mortgage.

One of the most common is to reduce the amount of interest that accumulates over time, as lifetime mortgages work on a compound interest basis.

Some homeowners experience a change in financial circumstances, meaning they no longer need the funds and wish to settle the loan.

Others might want to pass on more equity to their family or switch to a different financial product that better suits their needs.

How Can You Pay Off a Lifetime Mortgage?

If you decide to repay your lifetime mortgage, the first step is to check whether any early repayment charges apply.

Some lenders offer flexible terms that allow partial repayments each year without penalties, while others impose charges based on how long the mortgage has been in place and current interest rates.

For those looking to clear the balance entirely, options could include using savings, an inheritance, or proceeds from selling the property.

Some homeowners consider remortgaging to a different financial product that offers better terms, though this depends on eligibility and available options.

What Should You Consider Before Repaying?

Before making any decisions, it’s important to assess the financial impact of repaying a lifetime mortgage.

Early repayment charges can be costly, and using a large sum of money to clear the loan may affect other financial plans.

It’s also worth considering whether the funds could be put to better use elsewhere, depending on your long-term goals.

Understanding the terms of your lifetime mortgage and the costs involved is key to making the right choice.

If you’re unsure, speaking to a mortgage advisor can help you explore your options.

Our team of specialists here at UK Moneyman, can provide tailored advice on lifetime mortgages, helping you decide what works best for your circumstances.