If you already have a mortgage taken out with Halifax before you retire, the company will take into consideration how you will afford the mortgage once you retire. All mortgages agreed to by Halifax must now end before you turn 75. However, the Halifax retirement mortgages under the Halifax Retirement Home Plan have been withdrawn as of 17 August 2011. This means that Halifax now only provides interest only mortgages under their traditional mortgage book.
The Halifax Retirement Home Plan was a service provided for Halifax retirement mortgages schemes. This product was a form of lifetime mortgage specifically geared to retired people with sufficient pensionable income. Customers who have an existing Halifax Retirement Home Plan are still able to move homes under these Halifax retirement mortgages and are still able to borrow additional money if they meet the designated criteria.
As an alternative to the previous Halifax Retirement Home Plan, new customers can choose to take out Halifax retirement mortgages in the form of lifetime mortgage schemes with alternative lenders, which are very similar to the Halifax Retirement Home Plan. Such specialist lenders are sure to emerge on the back of the success of the Halifax's pensioner mortgage
Why was the Halifax Retirement Home Plan suspended?
Because the Halifax Retirement Home Plan was the most popular of Halifax retirement mortgages, the company was unable to keep up with the volume of applicants for the loan. The administration required was putting too much strain on the business, so they decided to pull the plug on the plan. In fact, the company was forced to compensate customers for a number of errors they had made due to excess volume of work. The plan gained popularity in that unlike a roll-up scheme, the interest of the Halifax Retirement Home Plan worked like a lifetime mortgage in that interest was not compounded. This therefore protected any inheritance that was destined for the children
What Interest Only Pensioner Mortgages Are Still Available?
These days, the amount of interest only pensioner mortgages are declining, and most lenders now insist that mortgages expire once the customer reaches the age of 75. The Halifax Retirement Home Plan mortgage was no different. There are a number of other companies who now offer interest only pensioner mortgages, but they often do so with caution as the criteria to qualify for such a loan become stricter. One such lender is Stonehaven who are the only lender to offer a fixed interest rate for life. Further articles on the Stonehaven interest select plan will follow.