Nationwide later life mortgages: which product could be right for you?

Nationwide later life mortgages are offering new options for making property work harder for them in later years. Find out what the options are and whether they could work for you

Nationwide later life mortgages
(Image credit: Getty)

You may have heard about Nationwide later life mortgages in the media, or, perhaps, you have a mortgage with Nationwide and are wondering how your equity could help you live better in retirement. 

Nationwide are doing well to recognise that as people are living longer lives, they need more mortgage options that are tailored to their needs. Specifically, as people begin to plan their retirement lives, many are discovering that even a lifetime of saving and pension contributions won't cover their lifestyle for the next 20 years or more. All their later life mortgages are available to people between the ages of 55 and 95, or up to 85 if you're a non-Nationwide mortgage holder. 

Nationwide later life mortgages: which one is right for you?

There are three mortgage types on offer in the 'later life' category, and they are quite different, so you'll need to think carefully about which one could work for you. 

  • The Lifetime Mortgage is Nationwide's equity release product which allows you to loan a lump sum of cash against a percentage of the equity in your home. This sum is tax-free and doesn't require monthly repayments (unless you choose to make them), with the loan becoming repayable when the last mortgage holder passes away or goes into long-term care. 
  • Retirement Interest Only mortgage: this mortgage works in the same way as any other interest-only mortgage, with the difference that the loan becomes repayable upon the last borrower's passing or going into care. It has a cap of £500,000 on it. 
  • Retirement Capital & Interest – this is essentially a standard mortgage where you repay parts of the loan and interest each month, but it is available to people who normally wouldn't qualify for a mortgage due to their age. This mortgage type also has a maximum loan amount of £500,000. 

Is a later life mortgage right for me?

Nationwide stress that although their later life mortgage products can be very helpful in improving your quality of life in retirement, the decision to apply for one shouldn't be taken lightly. Any form of equity release or loan that becomes repayable upon your death/going into care will have a direct impact on any inheritance you will be able to leave. As such, later mortgages are better discussed as a family, because your financial decision will affect others. Also note that in order to to be eligible for Nationwide's later life mortgages you'll need to be in receipt of a pension (state, private, or workplace).