Lifetime leases offered to pensioners

Pensioners in the UK have been offered a new deal by the government which will allow them to buy a lifetime lease for their property.

This is designed to be an alternative to the traditional equity release plan and it allows pensioners to move into a house for life at discounts of between 24 and 53 per cent of the purchase price.

However the over-65s should be warned that they do not then own the property but will live there for as long as they are alive, not benefiting from any capital growth.

They must also still pay any stamp duty or legal fees where appropriate but it is hoped this deal will help them to clear debts and raise their finances to provide an early inheritance.

Pensioners will buy lifetime leases and take a gamble that they will be paying a large amount but that it will be cost-effective because they will outlive the lease. However in cases where they die after just a few months, no money can be gained back from the original lease payment.


© Adfero Ltd