Older homeowners now have an extra home finance product to consider – retirement interest-only (ROI) mortgages.
These products allow homeowners to pay monthly interest on their loan until they die, sell their house or go into long-term care. At this point the loan is repaid by selling the house.
Lifetime mortgages are very similar. These are loans secured against your house that allow you to release some of the equity you have built up. But, they are only available to over 55s.
Dave Harris, chief executive of lender More 2 Life, said the main difference from lifetime mortgages is that RIO loans require borrowers to pass affordability checks and commit to making regular payments for life.
RIO loans also tend to be sold by general mortgage brokers, whereas lifetime mortgages are generally sold by specialist equity release advisers.
We highly recommend speaking to an advisor before choosing either option.