The Mansfield launches Retirement Interest Only mortgages with added drawdown facility
17 September 2018
Mansfield Building Society is launching its Retirement Interest Only (RIO) proposition with two innovative mortgage products that enable borrowers to take subsequent additional drawings up to a maximum of 40% LTV.
RIO mortgages offer older homeowners the advantages of equity release but without interest ‘roll up’ eating into their equity. Instead, RIO mortgage borrowers repay the interest cost on their mortgage to ensure the mortgage debt does not increase - the capital balance of the mortgage is cleared either upon sale of the property, or when the final surviving borrower moves into long term care or dies.
To ensure that borrowers receive appropriate advice, access to The Mansfield’s RIO mortgages is exclusively available through qualified advisers holding the CeReR or CertER qualification.
Both RIO mortgage products are available to borrowers over 55 years of age, details include:
5 year discounted rate
- 2.83% variable pay rate (2.76% below SVR)
- £199 application fee
- £800 completion fee
- No early repayment charge
3 year fixed rate
- 3.35% pay rate
- £199 application fee
- £800 completion fee
- 3% early repayment charge
Mike Taylor, Head of Products and Savings at the Society, said The Mansfield is delighted to be launching its RIO proposition to further support borrowers in, or fast approaching, retirement:
“As a mutual building society, we believe it’s important that older borrowers have choice. Our common sense, straight forward and innovative approach is designed to give later-life borrowers options to help support their lifestyle needs in retirement – we believe the access to subsequent draw-downs will prove popular with borrowers.
Borrowers can access the equity they have built up in their home to help close family members get onto the property ladder, or use the funds to maintain their lifestyle and fulfil their retirement plans. In addition, provided borrowers can maintain the interest only payments going forward, our RIO mortgages can also be used to help borrowers who have an existing interest only mortgage and are unable/not yet ready, to repay the capital balance due. RIO mortgages will provide welcome relief to many who may have underestimated their financial needs in retirement.
It’s great to be offering products with new features that meet the growing needs of brokers specialising in later-life lending and adding to the reputation building societies are earning for creating common sense solutions that meet the needs of everyday people.”
