Pure Retirement has launched an equity release mortgage that allows borrowers to repay up to 40 per cent of their loan each year penalty free.
Homeowners who use the Heritage Freedom 40 deal can make a maximum of 12 repayments a year which allows borrowers to set up a monthly payment and reduce the impact of rolled up interest on the value of their debt.
Traditional equity release mortgages only allow borrowers to repay up to 10 per cent of their loan each year before early repayment charges are applied.
Pure Retirement said it designed the product for borrowers who either wanted to make regular payments at a higher amount than any other equity release product would allow or for those who wanted to pay back a single large payment.
Pure’s Heritage Freedom 40 deal is available to applicants aged 55 and over. There is no maximum age cap and applicants can take loans from between 21 per cent loan to value (LTV) and 52 per cent LTV depending on the number of applicants, their ages, and the product type.
The lender will accept properties valued from £70,000 up to £2m with loan sizes up to £600,000 that can be taken as either lump sum or drawdown facility.
Head of products Brendan Gilligan said: “Recent research from Knowledge Bank has highlighted early repayment charges and partial repayments as among the leading equity release search terms by consumers, and it’s exciting to be able to offer a new product that meets customers’ increasing appetite for flexible products.”