The Lifestyle Flexible Option offered by Aviva is a fixed rate lifetime mortgage that offers much flexibility when it comes to accessing funds, both immediately & for the future. Homeowners are provided their initial lump sum payment while also having the potential to release more funds when needs must at a later date. The advantage of these drawdown lifetime mortgage schemes is that the homeowner only incurs interest on any fund they have withdrawn.
There are several key features to this equity release product. First, the homeowner receives their cash upon completion and there are no commited repayments during the loan term. There is also a no negative equity guarantee included as Aviva are members of the Equity Release Council.
One of the most flexible features of this product is that the homeowner can maintain a cash reserve for future withdrawals. The minimum cash reserve amount is £15,000. The homeowner can take as little as £10,000 in their initial release and then have a minimum reserve of just £5,000 available for future equity releases. There is a minimum requirement for each future release of at least £2,000 from the cash reserve, each time they borrow. There is no interest incurred until the funds are actually released and the homeowner is able to keep up to 50% of the maximum amount borrowed in the cash reserve for future releases.
There is a great deal of flexibility with the Aviva Lifestyle Flexible Mortgage. There are options available for the individual needs of homeowners such as the inheritance protection guarantee. This guarantee is optional and can be used as a way to protect a certain percentage of the future sale price of the home. By opting for this feature, the homeowner is able to ensure that they have funds left over from the sale of their property to still leave behind an inheritance to their beneficiaries.
Secondly, homeowners may be able to borrow more funds in the future, provided that they meet the lending criteria at the time of borrowing. There is also a Voluntary Partial Repayment Option available with the Lifestyle Flexible Mortgage for any homeowner. This applies only to plans taken out after 28th April 2014. With this feature, clients are able to repay up to 10% of the amount that they have borrowed each year after the first. They can do so in up to four instalment payments without incurring any early repayment charges.
These features make this product especially flexible for those homeowners who are interested in releasing funds, while also ensuring that they have options for the future, including future releases, inheritance protection and the ability to manage the balance going forward. Therefore using the 10%pa repayments, consumers can choose whether to pay off the interest only, or even manage the Aviva Voluntary Repayment Plan as a capital & interest plan.
In order to take advantage of this product, the homeowner must be at least 55 years old. Their home must have a minimum valuation of at least £75,000. There is no maximum value. At age 55, the homeowner is able to release upto 13% of the property value and this number increases all the way up to 45% from age 84 onwards. This Loan to Value (LTV) amount does not change over the lifetime of the loan. This flexible lifetime mortgage product is available in Wales, Scotland, England, and Northern Ireland.