Canada Life Home Finance has launched Capital Select Lite, offering homeowners the ability to tap into the value of their property with repayment flexibility, at a rate competitive with the lowest deals currently on the market.
Capital Select Lite is the latest option in the Capital Select range. The new Lite option offers an annualised interest rate (AER) of 3.86%, compared with 4.35% for Capital Select Gold, giving it one of the lowest interest rates of any equity release deal on the market.
Canada Life’s Capital Select Options range allow customers to make payments from anywhere between £50 up to a maximum of 10 percent of the initial loan amount each year, without incurring an early repayment charge (ERC). Customers can also choose to add a cash reserve facility to their mortgage.
Though Lite comes with lower Loan to Value (LTV) rates than other options within the Capital Select range (23% for a Lite customer aged 70), a maximum of £1 million can be taken out against a property’s value. Canada Life will also consider bespoke arrangements for those wishing to draw in excess of £1 million, on a case by case basis.
Alice Watson, head of marketing and communications at Canada Life Home Finance, said:
“Canada Life is committed to meeting the needs of customers in the home finance market, and the launch of our new Capital Select Lite option is the latest evidence of this. Customers are keen for a lifetime mortgage product that offers them flexibility and greater control over how, when and if they repay their loans. However, they want one at a rate closer to the most competitive offers currently on the market for equity release products.
“Capital Select Lite delivers exactly that. It offers a low rate to homeowners over 55 who are looking to draw on their property value, and also leave their options open to pay down the mortgage should their circumstances change: the best of both worlds.”
Canada Life also announced that the LTV rate would no longer differ for sole or joint borrowers on its Lifestyle Platinum and Lifestyle Platinum Cashback options (now both set at 42% for customers aged 70). The changes mean that joint borrowers now have access to a higher LTV for the Lifestyle Platinum products, allowing them to take out more equity should they wish to.
All Canada Life Lifetime Mortgage products come with an optional Inheritance Guarantee and have a no negative equity guarantee.
There is no penalty in the event that the offered facilities to pay down loans are not used.