The product has been designed on More2life’s current Maxi Super 1, 2 and 3 lifetime mortgage options, which offer partial repayments from day one and have fixed ERCs.
The newly launched Maxi Zero ERC product aims to help borrowers who believe their circumstances might change within the period that ERCs would usually apply.
It is available to borrowers aged between 55 and 89 at loan-to-value (LTV) tiers of between 20.5% and 49.5%.
Loan sizes from £15,000 to £700,000 are available.
There is no partial repayment limit, allowing the borrower to repay the mortgage in full at any time without incurring an ERC. There are also drawdown options.
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The Maxi Zero product has an arrangement fee of £1,199 for the initial advance and £499 for any further advance.
The product also allows downsizing from day one, giving borrowers the ability to downsize to a property outside of More2life’s criteria and repaying the loan in full with no ERCs.
Additionally, it has an indefinite ERC exemption window for joint life cases, so when the first borrower passes away or goes into long-term care, the second borrower can repay the loan without any ERCs.
The rates start at 6.77% monthly equivalent rate (MER) and the product is available through a limited number of distributors including Air members, The Later Life Lending Network, Key, and Mortgage Advice Bureau (MAB).
Taking the later life sector forward
More2life said the product was “one of a kind” in the later life market, where ERCs of 10-15 years usually applied.
Its recently relaunched Apex product has one of the shorter ERC periods in the later life space at four years and is available up to 52% LTV.
Ben Waugh (pictured), managing director of More2life, said: “To say we’re excited about the launch of this new Maxi Zero ERC product would be an understatement. We believe it is a complete game-changer for the lifetime mortgage market, advisers, their clients, and the wider later life lending space.
“To have a product with no ERCs is going to provide advisers with an enhanced option, especially those who have homeowner clients whose circumstances might change within a relatively short space of time. Not only could this product provide the finance the client needs from the outset, but it also allows them to pay off their lifetime mortgage at any point with no charges at all. This is something that has been unheard of within the later life lending sector up until now.”
He added: “The industry, as a whole, has been challenged to deliver the next generation of later life lending products for borrowers with a whole host of needs and circumstances [that] have not, and could not, be met by more traditional options. We certainly believe that with Maxi Zero ERC, and a number of other products we’ll soon be launching, More2life is delivering on this challenge.
“The launch of this product takes the later life lending sector forward once again, with an option that has never been available before. For existing later life advice specialists, and those mainstream players reviewing their involvement, it is proof of the revolution taking place in this space; opening up further solutions to deliver the positive consumer outcomes we all wish to see.”
Mark Gregory, founder and CEO of Equity Release Supermarket, said: “The introduction of More2life’s Maxi Zero ERC product brings about further positive change for our industry. Our advisers will welcome the addition of this innovative, flexible product to our independent, whole-of-market advice process.
“From a practical perspective, we’ve already seen how this supports customers considering a lifetime mortgage who expect their circumstances to change in the period where an early repayment charge would usually apply, after already discounting downsizing and other mortgage alternatives. It also endorses how our market continues to evolve in line with the changing needs of consumers.
“Continued focus by More2life on pushing the boundaries and setting new product standards is exactly what our industry needs – something I’m a strong advocate of.”
