Freestyle® Lifetime

What conditions apply to the Freestyle Lifetime Mortgage?

The following conditions must be met before you apply for our Freestyle Lifetime Mortgage:

• Early repayment charges will not apply when the mortgage would naturally be repaid (meaning, in the case of a single application, following your death or move from home into long-term care or, in the case of a joint application, the remaining applicant's death or move out of the home into long-term care).
• The minimum age of the younger applicant is 60. There is no maximum
• Properties must be of standard UK construction
• You must either own your home outright before you apply or use some of the funds provided by the Freestyle Lifetime Mortgage to clear any outstanding debt secured against the property
• After starting the Freestyle Lifetime Mortgage, you cannot use your home as security for any other financial agreement
• On application, your home should only be occupied by people who hold title to the property. If anyone lives with you who is not a co-owner of the property, you will not qualify for a Freestyle Lifetime Mortgage from Standard Life Bank
• No medical or credit checks will be required
• Early Repayment Charges apply in the first ten years.

How easy is it to apply?

To ensure you have considered every viewpoint and future scenario, it is essential that you get financial advice.

Your financial adviser can explain the benefits and implications for your specific circumstances and can choose from a range of products from different providers. They can explain any issues in detail and answer any questions. Once you have agreed on the way forward the process is easy:

• Your financial adviser will contact Standard Life Bank to make your application on your behalf
• We will arrange for a valuer to contact you for your property to be valued. You will be required to pay the fee to the valuer
• You will need to appoint a solicitor to act on your behalf
• We will send you the offer of a mortgage for you to sign and return - your solicitor will also receive a copy
• The cash will be paid to your solicitor on completion and they will send this to you on our behalf

What if I do not have a financial adviser?

To discuss the product, it's benefits and implications, you must speak to a financial adviser. If you need any help finding a financial adviser use our Find a Financial Adviser tool.

How much will a Freestyle Lifetime Mortgage cost me to set up?

Setting up your Freestyle Lifetime Mortgage will incur a number of different fees. Your solicitor should provide an estimate of their fees and you will also need to pay Standard Life Bank's panel solicitor who acts on the Bank's behalf.

You may be charged by your financial adviser for the advice they provide - they will receive commission for selling Freestyle Lifetime Mortgages and they are required to tell you how much they will earn.

You will also be charged an arrangement fee and a valuation fee. View our valuation scales

If you wish, you can add the arrangement fee to the mortgage. This will increase the amount you owe.

Please see our tariff of charges for full details

What insurance will I need?

There is no life assurance requirement but buildings insurance must be in place before we release the funds and must remain in place throughout the term of the mortgage. This must be for the minimum rebuilding cost.

What is SHIP?

Our Freestyle Lifetime Mortgage complies fully with the guidelines set by SHIP.

SHIP stands for Safe Home Income Plans. It is a company supported by the leading providers of home income and lifetime mortgages. As Standard Life Bank is a member of SHIP, we are committed to following their strict code of practice.

This code ensures we provide a fair, easy to understand, full presentation of our Freestyle Lifetime Mortgage. This also includes the need to employ an independent solicitor to carry out legal work on your behalf. For example, they will give you legal advice on the Freestyle Lifetime Mortgage and its impact on your estate.

As a SHIP member, Standard Life Bank also offers you a 'no negative equity' guarantee.

For more information about SHIP, visit their website www.ship-ltd.org or call 0870 241 6060.

What is the 'no negative equity' guarantee?

We offer a 'no negative equity' guarantee. This means that the amount you repay can never be more than the best reasonable market price that your home obtains when it is eventually sold. Even if the amount you borrow (plus compounded interest) is more than the selling price, you will not have to repay any more than the amount your home is sold for. Additionally, any selling costs paid in a negative equity situation will be met by Standard Life Bank.

How is the loan repaid?

In most cases, the Freestyle Lifetime Mortgage will need to be repaid when you die or move out of the home and into long-term care.

It is important to note that we will never insist that you leave your home because you need long-term care as, in many cases, this can be provided in your home. However, if you can no longer look after yourself and you need to leave your home, then the loan will become repayable

If you are making a joint application, the mortgage will become repayable when the remaining applicant has either died or moved out of the home and into long-term care. Usually, the repayment will be made from the proceeds of the sale of the borrower's property.

The mortgage may also become repayable if, for any other reason, you wish to repay your mortgage early, you decide to sell your home or you breach any of the terms or conditions of this mortgage. If you decide that you want to move to another property, you can take the mortgage with you as long as the property meets our criteria.

If your new property is worth less, you may need to repay some of the mortgage. In this situation, we will not charge a fee to transfer the mortgage.

What are the implications for my estate, taxes and state benefits?

All of these things can be affected when you take out a Freestyle Lifetime Mortgage. Your financial adviser or solicitor can give you full details.

How is interest applied?

Interest on the mortgage will be applied at a fixed rate. The accrued interest will be compounded yearly. This means that the interest accumulated each year is added to the total amount outstanding. In subsequent years, interest is charged on the new compounded amount.

What if I wish to repay part of my mortgage early?

If you wish to repay part of the mortgage within the early repayment period, then Early Repayment Charges will apply. Full details will be displayed in your Key Facts Illustration.

Early Repayment Charges apply for the first ten years. They are expressed as a percentage of the initial loan and any subsequent drawdowns, or in the case of a partial redemption, the sum repaid (subject to minimum partial repayment of £2,500). With regards to subsequent drawdowns the penalties will commence from date of relevant drawdown.

What if I wish to repay all of my mortgage early?

If you wish to repay the full mortgage within the early repayment period (the first ten years) then please note the following:

• Early repayment charges will not apply when the mortgage would naturally be repaid (meaning, in the case of a single application, following your death or move from home into long-term care or, in the case of a joint application, the remaining applicant's death or move out of the home into long-term care)
• Early repayment charges will not apply when the repayment is due to moving house and the lifetime mortgage is being taken with you.

When paying early repayment charges in all other cases, a redemption discharge fee will also apply.

Early Repayment Charges apply for the first ten years. They are expressed as a percentage of the initial loan and any subsequent drawdowns.

Please see tariff of charges for further details.

What if my circumstances change in the future?

Naturally, we've planned ahead to give the mortgage the capability to adapt as your circumstances change. So, for example, if you wish to move home you can either repay the mortgage completely or take it with you. Please note, a move to a property of a lower value may involve at least a partial repayment of the mortgage.

Similarly, if you wish to change the ownership of your home from single to joint (if, for example, you were to marry), the mortgage may become repayable. Each change of ownership will be individually assessed by Standard Life Bank.

After you receive your money, if anyone else moves into your home, you must tell us. We may write to them to tell them about your Freestyle Lifetime Mortgage.

You should let us know if you move into long-term care. It is your estate executor's responsibility to inform us of your death.

What if I wish to move home?

The mortgage is portable. So it can move with you if you move home (subject to lending criteria at that time). If you move to a property of a lower value, you may have to repay a portion of the mortgage at no additional charge.

Who will look after the maintenance of my home?

As the owner, you must maintain your home to keep it in the same good standard as when you applied.

What if I want to borrow more money in the future?

If the amount we are willing to lend is more than you want to borrow, the difference will be kept for you in a Cash Reserve facility at no extra cost. You can withdraw amounts from this facility at any time during the first five years of the mortgage (subject to a minimum of £5,000 each time)

Any further amounts you take in this five year period (and the interest charged on them) are simply added to the outstanding balance. The interest rate for each withdrawal will be fixed at the time of withdrawal. To take advantage of your Cash Reserve, contact your financial adviser. Please note, Cash Reserve applications will be accepted via financial advisers only. Drawdowns on your Cash Reserve will increase the amount secured on your property.

If after five years, you want to borrow more money, we will need to reassess your situation. Your home will be revalued and assessed against the Loan to Value that applies to your age group. The interest rate for further borrowing is set at the time of withdrawal.

A fee (currently £99) applies but will only be charged if the application is successful. You can repeat this process every five years through your financial adviser.

How do I apply?

Once you decide that you want to progress to the next stage, you should take the following steps:

• Request an information pack from Standard Life Bank by calling 0845 609 0254
• We recommend you discuss the Family Guide with your beneficiaries. If you choose not to discuss it with them, we ask that you write to us stating this fact. You'll find the Family Guide in your information pack
• Discuss everything with your financial adviser, making sure you understand all the product details and financial implications
• Ask your financial adviser to obtain a Key Facts Illustration to show what the fixed interest costs would be over the years.
• If you are completely happy, ask your financial adviser to proceed to application
• We will arrange a valuation of your home
• You will need to appoint a solicitor to act on your behalf
• Ask your solicitor for independent legal advice. We will send your solicitor a guide along with a copy of the offer
• On completion, your solicitor will receive the cash lump sum to pass onto you

You will also need your own solicitor to act for you. We require them to sign a certificate stating that you have consulted them and that they have explained the implications of the Freestyle Lifetime Mortgage on any state benefits, taxation, your Will and your estate.