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As Pam and Mike Hughes (57 & 59) approached the end of their fixed-rate period on an interest-only mortgage, they faced significant financial challenges. With limited income contributing to affordability concerns, historic credit issues*, and the prospect of retirement looming, traditional mortgage solutions such as C&I, RIO, or TIO were not viable options.
Approaching retirement: With plans to retire soon, they required a mortgage solution that would not extend into their retirement years
Limited market options: Conventional mortgages were either unaffordable or unsuitable, requiring higher payments than they could manage
Affordability calculation: Flexi PTLM assesses affordability based on the amount borrowed above the base Flexi lifetime mortgage, rather than the total loan amount. Equity release specialist adviser, Colin Le Maitre, who after considering all options available recommended Flexi PTLM to his clients, explained: "This innovative approach makes it accessible for clients like Pam and Mike, who need a solution tailored to their financial situation".
Part-interest-served hybrid: This structure allows the Hugheses to pay only part of the interest, which has significantly reduced their monthly payments. The part-interest-served model provides a cost-effective alternative to full-interest or capital repayment mortgages, easing the financial burden on your clients.
Reduced payment term: The mortgage payments are required only until the oldest borrower turns 66. After that point, providing all payments are made, the plan holders secure guarantee of tenure throughout the roll-up lifetime mortgage period. This aligned perfectly with the Hughes' retirement plans. "This feature offers certainty and peace of mind, ensuring that borrowers are not burdened with payments well into their retirement," said Le Maitre.
"This solution not only addressed their immediate financial needs but also provided a sustainable plan for the future, something which a product transfer or full-interest-served option could not," Le Maitre remarked.
By offering a unique blend of affordability, flexibility, and a limited payment term, Flexi PTLM, in this instance, provided a tailored solution that traditional mortgage and other later life products could not match.
As Colin Le Maitre highlighted, "The success of this product in meeting the specific needs of clients like Pam and Mike underscores more2life's commitment to innovation and client-focused solutions in the mortgage market."
Pam and Mike’s case exemplifies how more2life's Flexi Payment Term Lifetime Mortgage can be a game-changer for clients facing similar challenges, providing them with the financial stability and peace of mind needed for later life.
*Historic credit issues will be reviewed on a case-by-case basis
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Challenges faced
Affordability constraints: The Hugheses were unable to secure a new residential mortgage due to limited income and high living costsApproaching retirement: With plans to retire soon, they required a mortgage solution that would not extend into their retirement years
Limited market options: Conventional mortgages were either unaffordable or unsuitable, requiring higher payments than they could manage
The solution: Flexi Payment Term Lifetime Mortgage
To address these challenges, the couple turned to more2life's Flexi Payment Term Lifetime Mortgage (Flexi PTLM), a unique solution that offered several key benefits:Affordability calculation: Flexi PTLM assesses affordability based on the amount borrowed above the base Flexi lifetime mortgage, rather than the total loan amount. Equity release specialist adviser, Colin Le Maitre, who after considering all options available recommended Flexi PTLM to his clients, explained: "This innovative approach makes it accessible for clients like Pam and Mike, who need a solution tailored to their financial situation".
Part-interest-served hybrid: This structure allows the Hugheses to pay only part of the interest, which has significantly reduced their monthly payments. The part-interest-served model provides a cost-effective alternative to full-interest or capital repayment mortgages, easing the financial burden on your clients.
Reduced payment term: The mortgage payments are required only until the oldest borrower turns 66. After that point, providing all payments are made, the plan holders secure guarantee of tenure throughout the roll-up lifetime mortgage period. This aligned perfectly with the Hughes' retirement plans. "This feature offers certainty and peace of mind, ensuring that borrowers are not burdened with payments well into their retirement," said Le Maitre.
Implementation and outcomes
Flexi PTLM provided a lifeline for the Hugheses. The product’s increased LTVs allowed them to borrow more than they could through other conventional lifetime mortgages, enabling them to pay off their existing mortgage and significantly lower their existing monthly payments."This solution not only addressed their immediate financial needs but also provided a sustainable plan for the future, something which a product transfer or full-interest-served option could not," Le Maitre remarked.
How Flexi PTLM delivered a better customer outcome
more2life’s Flexi Payment Term Lifetime Mortgage was instrumental in helping Pam and Mike Hughes manage their financial situation as they approached retirement.By offering a unique blend of affordability, flexibility, and a limited payment term, Flexi PTLM, in this instance, provided a tailored solution that traditional mortgage and other later life products could not match.
As Colin Le Maitre highlighted, "The success of this product in meeting the specific needs of clients like Pam and Mike underscores more2life's commitment to innovation and client-focused solutions in the mortgage market."
Pam and Mike’s case exemplifies how more2life's Flexi Payment Term Lifetime Mortgage can be a game-changer for clients facing similar challenges, providing them with the financial stability and peace of mind needed for later life.
*Historic credit issues will be reviewed on a case-by-case basis
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