Entering the market in 2004, Just Retirement began offering annuity products. The founders wished to provide a stable retirement for individuals through a release of pension funds or equity release tax-free cash. While they started with annuity releases for individuals with illnesses, the company has also released two lifetime mortgage products: lump sum plus and roll up.
Features and Benefits
The roll-up lifetime mortgage provides money to homeowners based on their property’s value and age. Interest accrues on the principle loan amount over time, where repayment is due at death or a move to long-term care for the surviving partner.
The youngest homeowner must be 60 years of age or older. The home must be freehold or leasehold with a term over 75 years, be in the UK and of standard construction. It also has to be the homeowner’s main residence. A minimum property value requirement is £70,000.
The loan to value percentage or LTV awarded to homeowners is based on their age and property value. A younger individual will receive a smaller lump sum than someone with a shorter life expectancy. The roll-up mortgage can also work as a drawdown lifetime mortgage versus a one-off lump sum equity release.
As a drawdown lifetime mortgage an initial sum is taken, and an additional amount is held in reserve in a cash facility. The cash facility is restricted to 3 times lower the amount than the initial advance. For example, if a lump sum of £50,000 is initially taken, the reserve can only hold £150,000. The minimum funds available are set at £10,000 with a maximum of £600,000 for property holders in England. Homeowners in Wales, Scotland, or Northern Ireland have a maximum of £250,000 LTV to borrow.
The equity release interest rate is fixed on the initial lump sum. Interest accrues only on funds withdrawn from the cash facility. Interest rates will be fixed for subsequent withdrawals based on current base rates. The rate can differ from the initial lump sum.
Just Retirement, in keeping with UK equity release regulations, provides a no negative equity clause. This clause stipulates the repayment including interest cannot exceed the value of the property. No additional assets the homeowner has can be used to repay the loan and interest.
Just Retirement provides a free, unlimited evaluation to homeowners in the UK.