Here’s everything you need to know about our Over 55 Buy-to-Let Voluntary Select Option – key features, how it works, helpful links, guides and brochures.
Our Over 55 Buy-to-Let Voluntary Select Option
Available to landlords aged 55 or over, our Buy-to-Let Voluntary Select Option gives you the flexibility to make repayments when it suits you. You can choose to repay up to 10% of your loan each year and there’s no penalty if you decide not to make repayments.
Each of our products offers different amounts you can borrow with different interest rates.
Our Buy-to-Let Voluntary Select Option allows you to make voluntary payments of up to 10% of the initial loan amount each year, without any early repayment charges.
For example, if you decide to borrow £80,000, you can choose to pay back up to £8,000 each year without any penalties.
You choose when to make payments and how much you’d like to pay back, up to your annual allowance. The minimum payment is £50 each year.
- The annual allowance is 10% of the initial loan amount. This is the amount you can repay in one year without charges
- Your annual allowance starts on the day your mortgage completes and ends a year later on the day before your completion date. For example, if your mortgage completes on 1 July, your annual allowance starts on 1 July and finishes on 30 June the following year
- If you don’t use your full allowance, it won’t roll over into the following year. For example, if you repay 5% in year one, your allowance won’t increase to 15% in year two
- You choose when to make payments
- We accept payments from the first day your mortgage completes
- You can make as many payments as you like up to your annual allowance and there’s no maximum number of payments.
- You can continue to make payments if you borrow more money at a later date
- You can make voluntary payments by standing order or bank transfer
- We’ll send you a standing order form when your mortgage completes and full details of your other payment options
- There’s no penalty if you choose not to make a payment. We’ll add the interest to your outstanding loan balance each month
How payments affect your loan
We give you control over your mortgage balance by letting you choose when to make payments and how much you pay back each year.
Your payments are completely voluntary, so there’s no penalty if you don’t make a payment.
A further advance allows you to borrow more funds from your property.
You can do this at any point, as long as your application meets our lending criteria and there’s still enough equity in your property.
Do I qualify?
In order to apply, you’ll need to:
- Take additional financial advice
- Borrow a minimum of £4,000
- Let us know what you’re using the money for
How do I apply?
- Seek advice from your financial adviser. You can find an adviser at the Equity Release Council if you don’t have one
- Your financial adviser will contact us to start the application process
- We’ll send them an application form. They’ll discuss this with you and help you complete it
- If your application is successful, we’ll pay the money directly to you
You can make annual payments on the additional borrowing after your application has been successful.
If you take a further advance, the value of your property might need to be reassessed and you may have to pay additional fees, including fees for financial advice. Your financial adviser can provide more details.
View our charges.
We apply a fixed interest rate to each further advance. This is based on the further advance interest rate for your product, at the time you apply. This rate may be higher or lower than the interest rate applied to your initial advance. Please read your Offer Letter carefully to understand how interest will affect the size of your loan in the future.
Fixed early repayment charges (ERCs)
You can choose to repay some or all of your mortgage at any time, but an early repayment charge may apply if you repay your loan earlier than expected.
Our early repayment charges apply for the first eight years of the initial advance or further advance.
Our early repayment charges are fixed so you know exactly how much it will cost. Our charges are set out in the tables below.
Voluntary Select Option
|Year loan repaid (end of year)||Early repayment charge (percentage of total loan)|
We also won’t apply an early repayment charge where:
- Repayment takes places after your death or the death of the remaining borrower
- The early repayment charge term has expired
- You stay within your 10% annual contribution allowance
You will always own your property and be responsible for maintaining it, as long as you follow the terms and conditions of the mortgage.
You’ll be able to keep your property until you die, as long as you follow the terms and conditions of the mortgage. Your property will not be repossessed if you don’t make payments.
Fixed interest rates
Your mortgage interest rate will remain fixed for as long as you have it. We also apply fixed interest rates to any additional borrowing. The rate for additional borrowing is set at the time you apply and can be different from the initial loan interest rate.
No negative equity guarantee
When your property is sold and the proceeds after solicitors’ and estate agents’ fees are not enough to pay the amount you owe, we won’t ask you or your beneficiaries to pay the shortfall. Any amount left over from the sale of your property will belong to you or your beneficiaries, if your property is sold for more than the amount you borrowed.
Whilst our buy-to-let mortgages share characteristics with a lifetime mortgage, they are not a lifetime mortgage. Instead, they are a type of later life buy-to-let mortgage.
Our buy-to-let mortgages can be used on both buy-to-let and consumer buy-to-let properties.
We won’t charge you a valuation or completion fee to set up this mortgage. You’ll still need to pay solicitor and adviser fees.
View our charges.
|Advice fee||As agreed with your financial adviser|
|Legal fee*||£950+VAT (estimated)|
*You may also need to pay disbursements
An Over 55 Buy-to-Let mortgage is a loan secured against your property. It will reduce the amount of inheritance you leave and may affect your tax position and entitlement to welfare benefits.