Enhanced Equity Release

Enhanced Equity Release

Equity release schemes enable you to free-up the money in your home by securing a loan against it. An Enhanced Equity Release scheme entitles you to increase the amount of money you receive as a result of a medical or lifestyle condition that you may have.

Enhanced Equity Release works on the same principal as enhanced annuities: the lender takes into account your medical condition or lifestyle restrictions and provides a larger amount of money when compared to a normal plan.

Enhanced Lifetime Mortgage

Enhanced Lifetime Mortgages are the financial product that provides enhanced equity release and it is designed to work in your favour if you have a health condition or restricted lifestyle. The more serious your condition is, the higher the amount of money you can receive. This is because the lender will have made a detailed assessment of your condition and decided that your life expectancy has been reduced.   For example, you might suffer from high blood pressure, cancer, diabetes, Parkinson’s disease, angina, stroke, obesity, etc.

Enhanced Lifetime Mortgage Criteria

You will be eligible of payment of an Enhanced Lifetime Mortgage if you satisfy a number of criteria that are determined by the lender – usually a large financial services or insurance company. You will be provided with a list of questions which will help to establish the extent of your medical conditions and how they impair your lifestyle.

The lender will probably obtain your medical records from your doctor and examine the answers to your questions in order to calculate how much money they will be prepared to lend to you.

These are examples of the sort of questions you will need to answer:

  • What is your Body Mass Index? This can be calculated using your weight, height and age.
  • Do you smoke? If so, how much do you smoke each day and what type of cigarettes do you smoke?
  • What exercise do you take each week?
  • How long have you suffered from your chronic disease and how does it restrict your lifestyle? A chronic disease could be something like Parkinson’s or Multiple Sclerosis.

Underwriters at the lender are responsible for assessing your health and lifestyle using mortality and morbidity tables which are commonly used by insurance companies.

Enhanced Lifetime Mortgage Eligibility

An outline of the eligibility requirements for Enhanced Lifetime Mortgages are as follows:

  • You must be aged 55 or more. If you are applying with your partner or spouse, this age restriction applies to the youngest person.
  • The minimum property value must be £80,000.
  • The minimum amount of money you will be able to release is £20,000. However, this may change in the future and varies according to different lenders.
  • Your home must be situated in England, mainland Scotland or Wales.