Using Equity Release to Buy a House

Are you considering moving home but unsure how to fund the purchase? Many people think equity release is only for homeowners looking to unlock cash from their current property. However, a lifetime mortgage – a popular type of equity release – can actually help you buy a new home without the need for monthly repayments.

At J Finance, we specialise in helping homeowners make the most of their property wealth. Whether you're downsizing, moving closer to family, or buying your dream retirement home, a lifetime mortgage could provide the financial flexibility you need.

What is a Lifetime Mortgage for Buying a House?

A lifetime mortgage is a type of equity release that allows you to borrow money secured against a property. Unlike a traditional mortgage, you don’t need to make monthly repayments (unless you choose to). Instead, the interest rolls up and is repaid when you sell the property, move into long-term care, or pass away.

When using a lifetime mortgage to buy a home, the loan amount is typically combined with your existing savings, proceeds from selling a previous home, or other sources of funds to complete the purchase.

Who Can Use a Lifetime Mortgage to Buy a House?

To qualify for a lifetime mortgage, you usually need to:

✅ Be 55 or older
✅ Purchase a main residence in the UK
✅ Meet lender criteria on the type and value of the property
✅ Have enough deposit or equity to cover any shortfall

Unlike standard mortgages, your income and credit history are usually less important, as the loan is secured against the property rather than based on affordability checks.

Why Use a Lifetime Mortgage to Buy a House?

✔️ No Monthly Repayments – Unlike a traditional mortgage, you don’t need to make regular payments unless you choose to, which may reduce the interest rate on offer.

✔️ Stay in Control of Your Home – You remain the legal owner and can live in your new home for life.

✔️ Flexible Lending Criteria – Ideal for retirees and older homeowners who may struggle to get a standard mortgage.

✔️ Unlock Property Wealth – Use the value of your home to fund your next move, whether it's downsizing or relocating.

✔️ Optional Interest Payments – Some plans let you pay off interest to manage the overall cost of borrowing.

Example: How It Works

🔹 You sell your current home for £300,000
🔹 You buy a new property for £400,000
🔹 You use £300,000 from your sale, less costs of moving, plus a £100,000 lifetime mortgage to complete the purchase.

You now own your new home without monthly repayments, and the lifetime mortgage is repaid when the property is eventually sold.

Things to Consider Before Taking a Lifetime Mortgage

⚠️ Interest Rolls Up – If you don’t make voluntary payments, the loan balance will grow over time.

⚠️ Affect on Inheritance – Your estate may be reduced, though some plans allow you to ring-fence a portion for inheritance.

⚠️ Moving Home – Most plans are portable, but you’ll need lender approval if you want to move again later.

⚠️ Impact on Benefits – Receiving a lump sum could affect means-tested benefits.

It’s essential to get expert advice before deciding whether a lifetime mortgage is right for you.

Speak to an Expert at J Finance

At J Finance, we provide expert equity release advice tailored to your needs. Whether you're looking to move home, unlock property wealth, or explore your options, we’re here to help.

📞 Call us today for a free, no-obligation chat.
📩 Book a consultation to discuss your options.

Move home with confidence – explore how a lifetime mortgage can work for you.

Frequently Asked Questions

How much can I borrow with a lifetime mortgage?
The amount depends on your age, property value, and lender criteria. Generally, the older you are, the more you can borrow.

What happens if I want to move again later?
Many lifetime mortgages are portable, meaning you can transfer them to a new property if it meets the lender’s requirements.

Will I still own my home?
Yes! Unlike home reversion schemes, a lifetime mortgage lets you retain full ownership of your property.