Voluntary Select Options - John and Liz


Making home improvements 

John and Liz:

  • Both in their early 80s
  • Own a property which needs modifications
  • No substantial savings but both have moderate pension pots
  • Want to protect inheritance as much as possible

John and Liz have lived in their home for 45 years. They don’t wish to move house, but their health and mobility means that they need to make modifications to their home to make it suitable for them now, and in the future.

They would like to build a downstairs bathroom and fit a stair lift to allow easy access to the first floor. These modifications are costly and they don’t have the savings to fund them.

Traditional lenders will not lend to John and Liz, but their financial adviser suggests looking at a lifetime mortgage. They don’t have the income to make regular repayments but by taking out a Voluntary Select lifetime mortgage, John and Liz can choose to make ad-hoc repayments whenever they like, in order to reduce the impact of interest rolling up.

John and Liz are able to release enough equity from their property to make their home improvements and they are able to protect their family’s future inheritance by making voluntary repayments as and when they can, using their income from their pension.

They also have the flexibility to borrow further sums in the future, either by adding a cash reserve facility to their loan at the outset, or by applying for additional borrowing.

Key benefits:

  • They don’t need to move out of their family home
  • Home improvements can be carried out with the cash they’ve released
  • Flexibility to make repayments so that interest roll-up can be reduced, without having to make monthly payments
  • Ability to borrow more funds in the future

Important information

This case study is a worked example and is for illustrative purposes only. We have taken care to ensure the information is accurate, but we accept no liability for any of the information we provide that you decide to use or for the suitability of any of the statements made. Individual financial advice and tax advice should be sought prior to taking out a lifetime mortgage, as releasing equity can change the inheritance tax position of the borrower and their estate, as well as potentially altering their eligibility for welfare benefits.

Find out more about our Voluntary Select Options.

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Canada Life International Limited and CLI Institutional Limited are Isle of Man registered companies authorised and regulated by the Isle of Man Financial Services Authority.

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Stonehaven UK Limited and MGM Advantage Life Limited, trading as Canada Life, are subsidiaries of The Canada Life Group (U.K.) Limited. Stonehaven UK Ltd is authorised and regulated by the Financial Conduct Authority. MGM Advantage Life Limited is authorised and regulated by the Financial Conduct Authority.