Our residential mortgages are designed for borrowers aged 50+ looking for a mortgage in later life or seeking alternatives to traditional equity release.
Borrowing up to 85% LTV is available on repayment or 75% on interest only subject to affordability.
Where interest only is chosen, a suitable repayment vehicle such as sale of property must be in place for the 50+ mortgage. We don’t require a repayment vehicle for the RIO as the mortgage is repaid on the sale of their home when either your customer moves into long term care or passes away.
Keep in mind these products don’t offer safeguards in the event of payment difficulties. The 50+ Mortgage and RIO Mortgage can be recommended without holding a specialist equity release qualification.
Benefits for your clients
-
With a choice of two residential mortgage packages, your client can opt for the product that suits them best
-
A choice of fixed term up to 41 years (50+ Mortgage) or no end term (RIO Mortgage)
-
The 50+ product is available on an interest only or repayment basis and both products can be used for purchase or re-mortgage
-
![Accountant [Gold]](https://hodgebank.co.uk/intermediaries/wp-content/uploads/sites/2/2024/07/Accountant-Gold-90x0-c-default.png)
2 year or 5 year fixed rates, reverting to SVR
-
![Hodge_Coin Stack [Gold]](https://hodgebank.co.uk/intermediaries/wp-content/uploads/sites/2/2024/07/Hodge_Coin-Stack-Gold-90x0-c-default.png)
2 or 5 year ERCs based on the product chosen
-
Available in England, Wales and mainland Scotland
Early Repayment Promise
The Early Repayment Promise is available to customers with a 50+, RIO or Holiday Let mortgage who want to sell their property during the term of the mortgage and redeem the loan in full, it offers added flexibility and peace of mind.
Product summary
| Option | 50+ Mortgage | RIO Mortgage |
|---|---|---|
| Loan Size | £20,000 to £2m (£1m for 85% LTV) | £20,000 to £2m (£1m for 85% LTV) |
| Maximum LTV | 85% on repayment or 75% interest only | 85% on repayment or 75% interest only |
| Purpose | Purchase and re-mortgage | Purchase and re-mortgage |
| APR | Please view our product Matrix for information on APRs | Please view our product Matrix for information on APRs |
| Product Fee | Fee free, £995, £1,495 and £1,995 options available | Fee free, £995, £1,495 and £1,995 options available |
| 2 year ERC | 3% in year 1 and 2 | 3% in year 1 and 2 |
| 5 year fixed ERC | 5% year 1, 4% year 2, 3% year 3, 2% year 4, 1% year 5 | 5% year 1, 4% year 2, 3% year 3, 2% year 4, 1% year 5 |
| Min / Max Term | Minimum of 5 years from age 50, maximum term of 41 years | From age 50, no maximum term as no end date required |
| Repayment vehicle | Sale of property, cash in of investments or assets at end of term. (For 50+ Interest Only) | Sale of property upon death or entry into long term care |
| Valuation Fees | Free up to and including property values of £1 million. Properties over £1m will have the £1m survey fee deducted. | Free up to and including property values of £1 million. Properties over £1m will have the £1m survey fee deducted. |
| Proc Fee | 0.55% gross via chosen Network or Club route | 0.55% gross via chosen Network or Club route |
| Location | England, Wales and Mainland Scotland | England, Wales and Mainland Scotland |
| Legal Fees | Free for standard remortgage | Free for standard remortgage |
| Minimum Property Value | £100,000 (where sale of property is chosen as the repayment vehicle, a minimum equity of £100,000 is required and also dependent on region) | £100,000 |
| Maximum Property Value | £10 million | £10 million |
Affordability
In order to be eligible for one of our residential mortgages, your client needs to demonstrate they can afford the loan. The property must also form suitable security for the loan.
- Employed/self employed income age limit: Up to age 80 based on discretion of underwriter and dependent on occupation.
- Joint Applicants: Beyond age 82, we will assess each applicant on their ability to continue with repayments in the event of death. We will factor in survivors/spouses pension and life cover.
- Number of income sources: We do not limit the number of income sources per applicant, any acceptable income will be taken into account.
- Rental property income: Acceptable indefinitely, no upper age limit.
If the applicant is still working, we will need proof of their employed/self-employed income. Where the loan extends beyond the expected retirement date, the applicant must benefit from a reasonable level of income in retirement in order to be eligible. The sources of retirement income we take into account include:
- Pension income or future entitlements
- Investment income
- Rental income (Residential and Commercial)
- Ltd company residential
- Holiday rental income
- Spousal/maintenance income
- Sub-contractor income
Criteria
Repayment strategy: For the RIO Mortgage, we do not require a repayment strategy as the capital element of the loan is repaid on death or entry into long term care. For the 50+ mortgage interest only option, there must be a suitable strategy in place to repay the loan at the end of the term:
- Sale of the home when downsizing to a more manageable property in later life
- Sale of other property owned
- Sale of investments
- Proceeds of a maturing endowment policy
- Pension lump sum
Property eligibility: The property must form a suitable security for the 50+ Mortgage. We accept a range of property types.
FAQs
Find out more about our RIO mortgage.
The loans can be repaid at any time; however, an early repayment charge applies in the first five years for five year fixed rates and the first two years for two-year fixed rates.
See our product summary for full details.
During any initial fixed rate or discount period, overpayments of up to 10% can be made off the capital without incurring early repayment charges.
Our 50+ mortgages benefit from the Hodge Early Repayment Promise. If you repay your loan because you sell up and vacate your property permanently then we will waive the early repayment charge.
We review the SVR regularly. The SVR may change to reflect changes in the Bank of England base rate or due to our funding or administration costs, economic effects and the impact of new laws or regulations. If it changes, we’ll provide reasonable notice.
Borrowing up to 85% is available on repayment or 75% on interest only subject to affordability.
The final amount we’ll lend is based on our assessment of your client’s ability to afford the loan. We’ll look at employment income (including self-employed) and retirement income that’s currently being paid, or forecast to be paid upon retirement.
We’ll also look at outgoings including any loans or financial commitments already in place.
For 50+, where your customer opts for interest only, we must be satisfied that the repayment vehicle chosen is of sufficient value to repay the mortgage at the end of the term. We’ll contact your customer during the mortgage to ensure their repayment vehicle remains credible and on track to repay the mortgage at the end of the term.
For the RIO Mortgage, the capital is repaid on death or entry into long term care.
As a responsible lender, we look at providing residential mortgage loans that remain affordable now and in the future.
Where your customer opts for interest only on the 50+ mortgage they will make interest payments monthly. There must be sufficient means to repay the mortgage at the end of the term. This could be through sale of property (main residence or second home) or cashing in investments or assets.
Where your customer opts for a repayment mortgage and makes all of their payments, they will have repaid their mortgage at the end of the term.
For RIO, the mortgage is repaid from the sale of their home when either your customer moves into long term care or passes away.
The 50+ mortgage is a residential mortgage available from age 50 where your customer can determine the length of the loan and the repayment method. This can be repayment or interest only. For interest only mortgages, a repayment vehicle is required to repay the remaining mortgage at the end of the term.
The RIO mortgage is an interest only residential product available from age 50 with no term end date. The mortgage is repaid from the sale of their home when either your customer moves into long term care or passes away.
