Canada Life now offers more flexibility for lifetime mortgage customers

More choice for equity release customers wishing to make regular interest payments

Canada Life has launched Advantage, a new range of lifetime mortgage products aimed at customers who want to service the interest on their equity release plan.

For customers who are comfortable taking on the obligation of paying an agreed interest payment each month, Advantage offers a discounted interest rate. Customers will benefit from the discounted rate for as long as they keep up with their interest payments.

When signing up for an Advantage plan, customers can agree to pay 25%, 50%, 75%, or 100% of their monthly interest each month. The level of discount increases the more a customer agrees to pay each month.

As with other interest-only lifetime mortgages, customers can stop making interest payments at any time. If they miss more than three payments over the life of the plan, it becomes a ‘roll-up’ lifetime mortgage where interest builds up each month. It is eventually paid back, along with the loan itself, when the customer passes away or moves into long-term care.

What else does Advantage offer?

Canada Life’s Advantage product comes with additional benefits and protections:

• Customers can repay up to 10% of the loan itself each year, on top of the interest payments, without incurring any early repayment charges. 
• Downsizing protection means customers won’t pay an early repayment charge if they decide to move to a less valuable property after three years. 
• There’s no early repayment charge on a joint plan if the surviving customer decides to repay the loan within three years of the first person passing away (or moving into long-term care).
• Customers can build inheritance protection into their plan. This means a guaranteed percentage of the property’s value will be passed on when the property is sold.

• The no negative equity guarantee ensures the customer’s family won’t owe more than the house is worth when it’s time to repay the loan and any accrued interest.

Canada Life’s Pete Maddern says: “The Advantage range has been designed to give customers greater choice and the opportunity to benefit from discounted rates. By rewarding those who choose to service a portion of their interest, we’re enabling customers to take more control over the total cost of their borrowing and make meaningful savings over the life of their loan.”

Is equity release right for you?

If you are thinking about equity release, it’s vital that you carefully weigh up the pros and cons of equity release. Just as importantly, speaking to an adviser can help you understand your options and compare plans across Aviva and other leading equity release providers.

To find out if you are eligible, how much you can release, and get all the advice and support you need, talk to one of our selected advisers by calling 0808 178 3055 or request a call back.