More2life has launched the UK’s first and only lifetime mortgage with no early repayment charges.
Designed for customers who anticipate changes in their personal circumstances, Maxi Zero allows them to repay some or all of their lifetime mortgage without facing any penalties.
This announcement was greeted positively by members of the industry, with Positive Advisers Ltd director and IFA, Mark Scott, described it as a “breakthrough moment” for the equity release market.
“This lifetime mortgage product will add flexibility to a previously inflexible marketplace,” he explained.
“I can envisage people using this as a short-term product if they want to downsize later. They may use it before locking into a more traditional lifetime loan if and when the rates are lower.”
Similar optimism was displayed by Release Freedom director, Simon Bridgland, who stated: “Innovation has been so desperately needed in the later life sector, and this product offers it in spades.
“Users of lifetime products are becoming younger, with needs that most existing products simply don’t cater for.
“This really does start to help plug that gap between traditional and later life mortgages.”
Additionally, Yellow Brick Mortgages managing director, Stephen Perkins, said: “One small step for More2life, one giant leap for equity release flexibility.
“For too long too many equity release borrowers have been handcuffed to an often uncompetitive deal, and have been unable to reduce or repay their debt without excessive fees.
“While this product still has its balances from arrangement fees, it is a step in the right direction and hopefully will see the rest of the market follow suit with similar options.”
Maxi Zero is available as an option on the Maxi Super 1, 2, and 3 plans and features a 0.75 per cent reduction in processing fees compared to the standard Maxi fees, with an arrangement fee of £1,199 applicable.
Thanks to the Newspage community for sharing their thoughts with FTAdviser
tom.dunstan@ft.com
What's your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
