More choice for older borrowers looking for retirement interest-only mortgages
Older borrowers now have more retirement interest-only (Rio) mortgages to choose from.
There are 18 providers offering 74 deals — up from just 36 this time last year.
The average interest rate charged has also fallen slightly from 3.5 per cent to 3.47 per cent, according to comparison website moneyfacts.co.uk.
The average interest rate charged on interest-only mortgages has fallen slightly from 3.5 per cent to 3.47 per cent, according to comparison website moneyfacts.co.uk
The lowest available today at 2.74 per cent is from Nationwide.
Rios work like a standard mortgage product as borrowers make monthly interest payments. However, there is no set end date or term for the mortgage.
Payments continue until either the borrower dies or goes into long-term care, then the property is sold to pay off the debt.
The loans were launched in March 2018, with only two providers. Borrowers have to be 55 or over, and own their home outright.
They also need an income such as a pension or annuity.