LV= is a mutual society offering lifetime mortgages and was originally established in 1843, in Liverpool, making it one of the oldest financial lenders in the UK still operating. The company started as the Liverpool Independent Legal Victoria Burial Society under the ownership of William Fenton and a few friends. While the society has changed a lot in terms of the products offered, the legacy remains as a place to provide financial products including mortgages to consumers.
LV= Flexible Lifetime Mortgage is a drawdown lifetime mortgage available to qualifying homeowners in the UK. Homeowners can take a smaller initial sum and then withdraw from a cash reserve facility as needed at anytime in the future.
Criteria of the LV= Flexible Option
The youngest homeowner must have a minim age of 60 years attained to qualify for the drawdown mortgage from LV=. The initial lump sum minimum is £10,000. Anytime after the initial tranche of tax free cash has been taken homeowners can have access to this cash reserve which is available in minimum amounts of £2,000 each time they make a withdrawal. There are no additional fees for withdrawing money from the cash reserve facility.
Plans work on a minimum property value of £100,000, where more reserve can be accessed the more property value a homeowner has. The LV= drawdown reserve facility is the only guaranteed reserve facility & will remain in place for at least 15 years.
This plan has the no negative equity guarantee to protect homeowners from interest roll up on the initial lump sum and any subsequent withdrawals. It has minimal inheritance protection based on homeowner reserve facility use and maximum amount available based on loan to value percentages.
Unique Features of the LV= Drawdown Mortgage
LV= allows their drawdown Flexible Lifetime Mortgage to be used on main residences or second holiday homes. If used on a 2nd home, the loan to value percentage is reduced by 10% when determining the maximum available funds. The same interest rate applies to both plans.
Repayment Options
LV= will permit partial repayments during the term of the plan; however they would be subject to the early repayments charges at that time, if applicable.
Normally full repayment is made upon death or when there is a move to full time residential care. In the event of joint ownership, the remaining applicant can stay in the home, move, or decide to repay the loan. If repaid within the first 3 years and one partner has moved on, the early repayment charge is waived. There is an early repayment charge for the first 10 years, in which the first 5 is subject to a 5% fee and the next 5 years is a 3% fee. LV= are the only lender currently to offer a fixed early repayment penalty.
LV= Equity Release Incentives
LV= Flexible Lifetime Mortgage has a free valuation incentive on completion of the loan process, as well as a 15 year guaranteed reserve facility.
