Aviva is one of the largest providers of lifetime mortgages in the UK. The company has offered retirement products since 1998, although they are formerly known as Norwich Union. Serving more than 198,000 clients in the UK, many homeowners have accessed tax free cash using an Aviva equity release. Aviva provides drawdown, lump sum, and other products like Lifestyle Flexible Option and Lump Sum Max Plans.
How does the Voluntary Repayment Plan Meet Lifetime Mortgage Demands?
Aviva offers a voluntary repayment mortgage as part of their lifestyle flexible option plan. This flexible plan is a roll-up lifetime mortgage with built-in repayment choices. The homeowner is able to make voluntary repayments of 10% per annum based on the original loan amount. The 10% payment will not be subject to any penalty fees. The amount can also add up to the equivalent of interest charged on the initial lump sum effectively becoming like an interest only lifetime mortgage. Aviva does restrict how the repayments are made. Homeowners will need to make a minimum payment of £500 for the year. Only four repayments can be made in a year rather than making a payment each month.
Qualifications and Criteria
Aviva voluntary repayment plans start from the age of 55. The youngest homeowner applying for the voluntary repayment plan must be aged 55, but there is no upper limit to the age. They are available in Scotland, England, Wales, and Northern Ireland. Qualifications are dependent on age and property value. A minimum property value of £70,000 is necessary to take out this loan. Homeowners can take as low as £10,000 as their minimum initial lump sum, with an option to withdraw more later on. The maximum loan amount is based on the property value and age.
This loan can also become a drawdown voluntary repayment mortgage. The homeowner can release more funds in a cash reserve facility. Payments must be taken in £2,000 increments or higher. There are no additional fees to create the cash reserve facility.
Equity Release Features and Incentives
Aviva is offering unique plans under their voluntary repayment option. By opting to pay the full 10%pa of the original amount borrowed will ensure full repayment of the equity release plan over a 16-17 year period. This is unique in the equity release marketplace where effectively this becomes a capital & repayment equity release scheme!
The Aviva plan includes a free valuation, with a potential of up to £1,000 cash back upon contract completion. There are specially reduced interest rates provided to homeowners who qualify. Aviva also provides an ill health option with their voluntary repayment plan. Homeowners can fill out a health and lifestyle questionnaire to determine if they qualify for a larger maximum lump sum, which affects the fixed interest rate awarded.
Should the maximum equity release not be required under the Aviva Voluntary Repayment Plan and ill-health persists then a lower than normal interest rate can be applied for.
* £5 application fee applies to application received until further notice
**Free valuation offer applies to properties worth upto £1,000,000
**Interest rates with the Aviva Lifestyle Flexi plan are dependent upon personal criteria, UK location and options selected.
The rate published assumes male age 62, living in BS11 with a property valued at £215,000 releasing £32,000 initially with £15,150 remaining in a cash reserve facility.
Call the Interest Only Lifetime Mortgage team on 0800 689 0925 for further details or request your personalised quotation.