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What's Equity Release?
Equity release is a financial term for a group of products that allow you to unlock the capital1 invested in your home.
It can be either a lifetime mortgage product or a home reversion scheme.
The lump-sum amount released is tax-free.
Looking for Something Specific?
Contributors:
Expert Verified Equity release is a financial product that enables homeowners who are at least 55 years old to release some of the value tied up in their property.
This can be done either through a lifetime mortgage or a home reversion plan.
This article explores the following topics, drawing on our expertise in the field:
With a lifetime mortgage, you borrow against the equity in your home and receive a tax-free lump sum or regular income.
The amount borrowed, including any interest accrued, is repaid when the property is sold or the homeowner passes away.
With a home reversion plan, you sell a portion of your property to a provider in exchange for a tax-free lump sum or regular income.
You continue to live in the property rent-free until you die or move into long-term care, at which point the provider sells the property and takes their share of the proceeds.
How Are Retirement Interest-Only (RIO) Mortgages Calculated?
Retirement Interest-Only mortgages are calculated based on the amount borrowed, interest rate, and term length.
The borrower only pays the interest during the term, and the principal is repaid when the mortgage ends.
How Will a Retirement Mortgage Lender Calculate the Amount I Can Borrow?
A retirement mortgage lender will typically calculate the amount you can borrow based on your age, the value of your property, and your creditworthiness.
What’s an RIO Mortgage Calculator?
An RIO mortgage calculator is a tool that helps you estimate how much you can borrow on a retirement interest-only mortgage based on your age, property value, and other factors.
What Information Do I Need to Provide to Use an RIO Mortgage Calculator?
To use an RIO mortgage calculator, you typically need to provide information such as your age, the value of your property, and any outstanding mortgage balance.
You may also need to provide details on your income and expenses to get a more accurate estimate of how much you could borrow.
How to Use a Retirement Interest-Only Mortgage Calculator
To use a retirement interest-only mortgage calculator, you’ll input the following information, and it’ll give you an estimate of much money you could borrow:
- The value3 of your property, which must be at least £70,000.
- The age of the youngest homeowner, who must be at least 55 years old.
- Your property’s postal code, to get your property location which, must be in the UK.
Once you’ve entered your information and hit submit, the calculator will send you an estimate of how much you could get with a retirement interest-only mortgage.
Why Should I Use a Retirement Interest-Only Mortgage Calculator?
Using a retirement interest-only mortgage calculator can help you estimate how much you may be able to borrow, what your monthly payments might be, and how much interest you could end up paying over the life of the mortgage.
This can help you make an informed decision about whether an RIO mortgage is right for you and how it may fit into your retirement plan.
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In Conclusion
Get a comfortable retirement! Use our free RIO mortgage calculator now! It’s the latest alternative to lifetime mortgages.
Don’t forget to seek advice from a financial adviser before making a final decision.
What are you waiting for? Try our RIO mortgage calculator for free today!
