Interest Only

Interest rates

Age 55 - 69 Age 70 - 74 Age 75+
6.08% 6.48% 6.68%

Unlike other lifetime mortgages, where no monthly repayments are made, our Interest Only product has been developed for clients who need to release funds but who are able to service the debt initially (it may be that they are still working, or have another source of income).

With this product your client can choose how long they want to repay the interest charged each month up to 30 years (for example, five years). At the end of their chosen repayment period, the client stops repaying the interest each month and the interest is then added to the loan each month.

For the entire life of the loan interest is charged at the same fixed rate.

The amount we will lend is based on our standard LTV criteria. See below.

If, for any reason, your client's circumstances change and they wish to stop making the interest repayments earlier than expected (or if they have three monthly repayments outstanding), then the interest rate charged on the loan will switch to the new rate (that the client has been informed of at the start of the contract) and Stonehaven will effectively advance your client the funds to cover the outstanding interest repayments.

These funds will be advanced to your client on a monthly basis and interest will be charged on them at the prevailing rate. All other aspects of the contract will remain the same.

In order to make this early switch your client must contact us directly and we will provide confirmation of the terms of the new arrangement, including the new interest rate and any charges incurred.

Your client's home will never be repossessed if they cannot keep up the interest repayments.

Loan Limits
Age 555657585960616263646566676869707172
Max LTV available (%) 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32

Age 737475767778798081828384858687888990
Max LTV available (%) 33 34 35 35 35 35 35 35 35 35 35 35 35 35 35 35 35 35

Exceptions:

The LTV may be adjusted in certain circumstances, such as sheltered accommodation or non-standard construction types.

Go to our Maximum Loan Calculator to find the maximum amount your client can borrow and the interest rate they will be charged.

What happens if your client stops paying the interest earlier than they'd originally planned?

Please refer to our 'Understanding our Interest Only' lifetime mortgage document

Other information

Applicants

1. Minimum age (for the younger borrower)

55

2. Maximum age (for the younger borrower)

90

3. Status

Available on both single or joint-life basis. Joint borrowers do not need to be married and may be of the same sex. If the property is in joint names then both owners must apply for the loan.

Property

4. Location

England or Wales

5. Minimum property value

£70,000

6. Maximum property value

Maximum value of £2m in Greater London & SE, or £1m elsewhere (may be exceptions)

7. Type

See our Lending Policy 'Acceptable properties and applicants.'

Cash advances

8. Minimum initial advance

£20,000

9. Maximum initial advance

£500,000

10. Charges

See'Our Costs'

Protected Equity Option

With all Stonehaven lifetime mortgages your client can choose to protect a percentage of the eventual sale value of their home. The No Negative Equity Guarantee and the amount that Stonehaven will lend are based on the value of the unprotected portion of the property.

If, in the future, your client wants to reduce the amount of equity protected in order to apply for further borrowing, then the following should happen:

  • If your client originally took out an Interest Only and protected some of their equity, they must apply for additional borrowing through their financial adviser. Stonehaven will not charge for reducing the protected equity option, however the normal charges and conditions associated with additional borrowing will apply.

Please note that the above scenario may impact your client's beneficiaries and the implications should be explained to your client.