Scottish Widows offers the most popular type of equity release, a lifetime mortgage. All Scottish Widows lifetime mortgages meet the Equity Release Council standards and afford you their protections.
Let's review:
What interest rates do Scottish Widows offer? And how do they stack up against the competition?
* Some other lenders offer variable live pricing. Please request your personalised illustration for your best rate.
How much money can Scottish Widows provide on their lifetime mortgages? Use our calculator to find out, plus see how they stack up to the wider market.
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Scottish Widows is a household name that has been offering financial services to the UK since 1815! They started offering equity release plans in the early 2000's; however, they withdrew from the market until relaunching in 2020.
Scottish Widows offers the most popular type of equity release plan, the lifetime mortgage. Let's explore some criteria and features in greater detail:
Lump Sum
lifetime mortgage |
Future Release
lifetime mortgage |
| Fixed-for-Life interest rates from 5.95% MER |
Fixed-for-Life interest rates from 5.95% MER |
| Can apply if the youngest borrower is aged 55-85 |
| Minimum property value £100,000 (£150,000 on ex-Local Authority, ex-Ministry of Defence and ex-Housing Association properties; £200,000 on Age-Restricted Property/Sheltered Housing) |
| Minimum loan £30,000 |
| Lump sum only |
Add a cash reserve to access money later |
| Optional payments of up to 10% each year |
| Downsizing protection |
| Significant life event waiver |
| Fixed early repayment charges |
| Free valuation on initial advance |
Free valuations: All Scottish Widows equity release plans offer free valuations on initial borrowing, regardless of the property's value.
I love this feature because it takes all the risk away from you. If there are any unforeseen issues with the survey, you will not have to pay anything upfront, and you will not be liable for paying a penny should you decide not to proceed.
Cashback on all plans: Scottish Widows provide you with £600 cashback to help cover your advice and legal expenses. They don't charge any application fees either!
Big brand: Scottish Widows is a household name with a strong reputation and a long trading history.
This can provide you with great peace of mind when taking a plan that could last the rest of your list!
Useful features offered by Scottish Widows
Significant life event waiver: For joint applications, if you repay the lifetime mortgage following the first borrower passing away or moving into long-term care, an Early Repayment Charge (ERC) is not applied.
Downsizing protection: With Scottish Widows lifetime mortgages, if after five years you move to a new property which they will not lend on and cannot port your lifetime mortgage, an Early Repayment Charge (ERC) is not applied.
Partial repayments: You can repay up to 10% of the loan amount each year without penalty. You can make up to one payment per year. Your annual allowance is renewed on the anniversary of the date the borrowing completes. Any unused balance does not roll over into the following year.
Fixed ERCs: Scottish Widows levy an Early Repayment Charge for the first ten years: – 10% in year 1, 9% in year 2, 8% in year 3, 7% in year 4, 6% in year 5, 5% in year 6, 4% in year 7, 3% in year 8, 2% in year 9, 1% in year 10 and 0% from year 11 onwards.
Scottish Widows equity release underwriting
Scottish Widows lends on most standard-built properties. However, there are some parts of their underwriting which are particularly strong compared to most equity release lenders:
Age-Restricted Properties: Scottish Widows lends on age-restricted properties, provided that you have owned your home for a minimum of three years, your home is valued at least £200,000, and there is a maximum resale fee of 3%.
Higher Ground Rent: Scottish Widows accepts properties with ground rent up to 0.1% of the property value. Most other lenders have hard limits of £250 per annum (or £1,000 in London).
Scottish Widows does not consider your medical history. Other lenders will consider certain medical conditions and offer more money or discounts to their standard interest rates for medically enhanced plans.
Scottish Widows is also not as flexible as other lenders for properties that are non-standard construction, near commercial activity, where you have poor credit, or where you run a business from home.
Furthermore, Scottish Widows do offer the ability to purchase a new home with equity release; you must have lived in your home for at least six months (unless you have inherited the property). All other lenders will allow you to purchase using equity release.
Future Release lifetime mortgages are also capped at 50% of the total facility in reserve, and there is a minimum of £5,000 per drawdown. This is much more restricted than other lenders; some allow you to borrow £500 each time.
As part of our equity release advice service, we will consider plans from Scottish Widows and compare them to those of other equity release lenders.
Please speak with one of our equity release advisors for your personalised illustration.
Scottish Widows is a household brand. Benefits of their plans include:
- £600 cashback on all cases
- Downsizing protection
- Significant life event waiver, and
- Reserve facilities.
However, you may be able to achieve larger loans and lower interest rates from other equity release lenders. Furthermore, Scottish Widows does not offer medically underwritten lifetime mortgages.
When you are ready, you can book an appointment with one of our equity release advisors, who can show you how Scottish Widows compares to other lenders for your specific needs.
If you have an existing equity release plan with Scottish Widows, we can help you assess the best way to borrow additional funds.
Where you have a reserve facility in place (from a drawdown plan), you can contact Scottish Widows directly on 0345 122 1607 to request additional funds.
However, I always suggest that you compare additional borrowing with Scottish Widows to the cost of moving to a different lender.
We will require your authority to discuss your existing plan with Scottish Widows. Please complete the form below so that we can send you a Letter of Authority to complete, sign, and return so that we may speak with Scottish Widows.
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Why don't I go to Scottish Widows directly?
Of course, you can go to Scottish Widows directly to request their lifetime mortgages. However, you still require financial advice before taking one of their plans, and they do not currently have any directly employed advisors. Instead, Scottish Widows will put you in touch with a financial advisor who will only advise you on Scottish Widows equity release plans.
If you choose to work with an advisor who works with other lenders, you could access a more suitable lifetime mortgage from another provider.
But won't I get a better deal by going direct?
The interest rates charged and the amounts of money you can release will be the same whether you go direct or through another advice firm.
Why not book your free equity release consultation with one of our equity release advisors to explore your options?
In closing
I hope I have helped you understand Scottish Widows equity release product offering and that you now know whether you could be a Scottish Widows equity release client. If you have further questions about Scottish Widows equity release plans or would like to see if Scottish Widows is the plan I recommend for you, contact us at 0207 158 0881.
Remember, we also compare plans from other equity release lenders, so we can save you time shopping around and find the most suitable plans. You can also use our equity release calculator to compare the lowest-rate plans.
If you have further questions, why not speak with one of our qualified advisors?
Call us on 0207 158 0881 or use our online form to book your FREE consultation.
While a qualified equity release advisor has written this guide, it is not intended to be used as financial nor legal advice and should not be relied upon.
To understand the full features and risks of an Equity Release plan, ask for a personalised illustration.
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