Your mortgage is probably the largest debt you’ll have in your life, and the monumental task of paying it off can be a stressful part of being a homeowner. The current mortgage climate is one of deep uncertainty, with rates increasing monthly, so thinking of ways to pay off such a large debt is on many people’s minds. Many homeowners also have interest only mortgages without repayment vehicles.
Historically, a 25 year mortgage term was the most popular, however 30 and 35 year terms are now becoming more frequent as people look to secure a home and keep their monthly payments to a minimum.
Of course, paying off your mortgage as early as possible is the ideal situation. There is no set rule as to how old you should be by the time your home is entirely owned by yourself, but in general terms, paying it off before you reach retirement age will leave you with less debt and more income as you stop working, thereby allowing you a more comfortable retirement.
It is definitely possible to get a mortgage later in life, however the terms will be less favourable. Lenders will look to offer you 10 to 20 year repayment terms due to the fact that you are older, which means your monthly payments will be significantly higher than they would be if you were younger.
If you still have a mortgage by the time you retire, you may want to look into ways to pay it off so you can live comfortably in the golden years of your life. Equity Release products such as Lifetime Mortgages are a way to release money built up in your home, which can then be used to pay off your debts. With a Lifetime Mortgage, there are no monthly payments, with the money only needing to be paid back after you pass away or enter long-term care. This is usually done with the sale of your home at a time when you no longer need it.
Yes, for peace of mind and financial stability, removing mortgage payments from your monthly finances would be convenient. For homeowners over the age of 55, an Equity Release plan could be the ideal way of getting rid of a mortgage debt hanging over you as you move into a stage of life where relaxation and comfort should be the main aims. You can get a lump sum or series of lump sums to pay off your mortgage or any other debts, fund home improvements or travel dreams, or help family with money during difficult times. WIth Equity Release Council equity release plans you have the right to remain in your property whilst it remains your main residence.
Speak to a Bower adviser today and see how Equity Release could help you enjoy your retirement without stress. We are proud members of the Equity Release Council with decades of experience in helping homeowners achieve financial freedom through releasing the money saved up in their home.
