Equity release lender, more 2 life, has added a drawdown facility to its capital choice plan, allowing customers to take out a minimum amount of £2,000 and a maximum drawdown amount of double the initial loan amount.
more 2 life’s existing capital choice plan is a lump sum lifetime mortgage that offers a flexible partial capital repayment option, which can help borrowers avoid early repayment charges (ERCs).
It is suitable for clients who are looking for a higher lump sum and the ability to make partial capital repayments from day one if they want to.
Dave Harris, chief executive at more 2 life, said: “At more 2 life, we are continually striving to make sure that we’re offering clients a range of products that include both useful and practical features.
“As such, it is great to be able to announce this new feature on our capital choice plan as we continue to work closely with our intermediaries to develop products that they and their clients want.
“By offering a new drawdown feature, we aim to provide older homeowners with the flexibility they want and need.
“The equity release market has experienced record-breaking levels of growth recently, but it’s vital that we continue to drive innovation in the sector.
“Innovative products with an increasing number of options will help more retirees’ access the wealth tied up in their homes and more 2 life intends to be at the forefront of these exciting market developments.”
These changes mean that rather than taking the entire sum immediately and paying interest on this, customers can draw down part of their loan as and when they need it.
As a result of adviser feedback, capital choice became the first plan the lender offered with fixed ERCs – in addition to the plan’s 10% ERC–free partial repayment option – in order to provide greater transparency around the charges borrowers could incur.
The plan also offers downsizing protection, giving borrowers peace of mind should they be unable to port their loan to a new property in the future, as well as a built-in guaranteed inheritance feature that allows borrowers to protect up to 50% of the value of their property, for lump sum plans only.