Pension Mortgage
A pension mortgage is an arrangement whereby interest only is paid to the lender.
Your mortgage payments are combined with payments into your personal pension fund intended to repay capital. This is designed to mature on your retirement, so the mortgage loan term must end between the ages of 50 and 75 unless the borrower is in an industry where the Inland Revenue permits earlier retirement.
The pension also needs to provide you with an income during retirement, so only twenty five percent of the pension fund can be taken as a lump sum to pay of your mortgage.
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