Unlike an ordinary mortgage, the interest only lifetime mortgage does not require any monthly repayment of the capital loan amount. Instead, only interest is required to be repaid every month. As the name suggests, the interest only lifetime mortgage does not have a fixed duration. It lasts for the lifetime of the borrower. As long as the borrower is alive and does not move into the care of a nursing home, the interest only lifetime mortgage will be remain valid.

The advantage of the interest only lifetime mortgage is that the initial loan amount does not build up. Like other forms of equity release, the interest only lifetime mortgage is repaid through the sale of the property which normally occurs when the borrower dies or when he or she moves into long term care. When the property is sold, only the initial loan amount will have to be repaid. Due to the fact that the interest is being paid every month, there is no accumulated interest amount that needs to be repaid with the initial loan amount.

The interest only lifetime mortgage is a prime example of the misconception that many people have about not being able to obtain a mortgage once you are retired. The interest only lifetime mortgage is available to pensioners or those who are at least 55 years, or older.

As long as pensioners own a property and have an alternative source of income that can be used to make the monthly interest payment, they can apply for an interest only lifetime mortgage.

Applying for the interest only lifetime mortgage has many advantages as well as disadvantages. It is a decision that must be made with serious consideration. However, as long as you can make the monthly interest payments, you can benefit greatly from an interest only lifetime mortgage. You will gain an additional source of capital which can be put to good use on such things as home improvements, holidays or gifts to children or grandchildren.

One particular interest only lifetime mortgage scheme is offered by Stonehaven and it has no income requirements and as such can be classified as a self cert mortgage. This is excellent should parents have limited income, but the children are happy to make the monthly payments. Additioanl features include a fixed interest rate for life & the facility to switch to a roll-up interest equity release plan should you wish to cease making payments in the future. This ensures that repossession can never be enforced as this back up plan is always available & offers peace of mind. A particular website offering details on this schemes is Stonehaven Equity Release.