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Lifetime mortgage proceeds go back into homes

Date: Mon, 22 Nov 04 Analysis

The majority of people who take out lifetime mortgages invest the money back into their homes, according to Norwich Union.

Along with home improvements, holidays and cars feature highly on the list of things people put money into when they take out a lifetime mortgage.

Norwich Union, the UK's leading lifetime mortgage provider, also found that money recovered from the value of houses was used to boost income levels in retirement.

"Lifetime mortgages are popular with people who want to maintain their lifestyle after they retire," noted Mark Kelly, director of Norwich Union Personal Finance.

"Many older people - particularly those on low incomes - use them to pay for home improvements such as new windows, conservatories and even to pay for things such as new central heating systems," he added.

Research conducted on behalf of Norwich Union found that more than 70 per cent of people with lifetime mortgages invested in home improvements.

Topping-up income was the next most popular use for the extra money, with 37.5 per cent of those polled saying they took this option. 34.9 per cent said they spent the money on a holiday, while 27.8 per cent of respondents have bought a new car with the proceeds of their lifetime mortgage.

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Endsleigh Insurance Services Limited. Company No: 856706 registered in England at Shurdington Road, Cheltenham Spa, Gloucestershire GL51 4UE.