The history of Canada Life starts with the merger of Stonehaven Equity Release and MGM Assurance. The company have built a reputation of creating innovative products that are easily customizable to suit each individual homeowner’s needs. That same creativity is consistent with the new line of Canada Life products just introduced to the marketplace, Second Home Options.
The products in this 2nd/Holiday Home series allow homeowners to secure a lifetime mortgage on their second property. Second Home Options is comprised of three products which give homeowners the option to choose whether they want the interest to roll-up & compound with no repayments, or pay the interest only on their mortgage, or have the flexibility of voluntary payments which could result in paying capital & interest. The choice is down to the homeowner.
Homeowners must be between the ages of 55 and 90 to be eligible for Second Home Options and if filing jointly, the youngest borrower cannot be more than 90 years old. All three products offer loans ranging from £10,000 to £750,000. Please contact the London Equity Release team on 0800 678 5159 if you require a personalised key facts illustration.
For the property to be eligible with these products, it must fit the definition of a second home, as outlined by Canada Life. This means that the home must be available for the sole occupancy of the homeowner and if it is let-out at all, it cannot be for more than 4 weeks at a time. The home must also be used by the homeowner for a minimum of 4 weeks every year and cannot have any formal agreements in place, including an Assured Shorthold Tenancy. The property cannot be advertised anywhere, including through an agency or online.
The property must be valued between £70,000 and £6million and must be located in Wales, England or Scotland. There are exceptions available for homes that exceed a £6 million valuation but those exceptions are made on a case- by -case basis.
The Voluntary Select option is one of the three products available in the Second Home Options line. This product allows the homeowner to pay up to 10% of the initial loan amount every year without incurring any early repayment charges. The minimum payment amount allowed is £50 with the maximum being the 10% yearly allowance. Homeowners are able to start making payment almost right away, as they can make their first payment on the day following loan completion. There is no limit to how many payment can be made each year and there are a number of options available when it comes to making payments. Homeowners can make payments through standing order, debit card over the phone, cheque or bank transfer. There is no penalty incurred if the homeowner does not reach the annual payment allowance of 10%.
The loan-to-value range with the Second Home Voluntary Select starts at 9% at age 55 and goes up to 34% for ages 80-90.
There is the option available to apply for additional borrowing with all three of the products in Second Home Options. The minimum amount that can be borrowed is £4,000 and the maximum is the maximum amount available within the product range. Homeowners are not allowed to switch to a new product when borrowing additional funds and they must stay within their original loan-to-value range.
The Voluntary Select option is the ideal product for any homeowner who wants the freedom to pay some of their lifetime mortgage balance. This typically applies to any homeowner who is concerned with interest roll-up. All of the three products in the line are suitable for any homeowner who wants the option of securing a lifetime mortgage with their second home, which is a brand new innovation in the equity release marketplace.
To obtain further information or to request a quotation on the Canada Life 2nd Home Voluntary Repayment Mortgage, please contact the Retirement Mortgages team on 0800 678 5159 today.