Start with the deadline and the balance
Find your latest statement, original offer and repayment plan. Confirm the exact maturity date and ask for a redemption figure that includes any charges. Check the value and availability of savings, investments or policies intended to repay the loan.
Do not assume that having made every interest payment means the capital can stay outstanding indefinitely. If the deadline has passed, or you are struggling with payments, speak to the lender promptly and seek free debt advice. Avoid ignoring letters or relying on an unagreed extension.
- Tell the lender your proposed plan and ask what options it will consider.
- Keep paying under the existing agreement unless the lender agrees otherwise.
- Leave time for valuation, underwriting and legal work if refinancing.
- Ask for any temporary arrangement in writing.
The options worth comparing
| Route | How it helps | What needs checking |
|---|---|---|
| Repay with available funds | Clears the mortgage without a new loan | Tax, emergency reserves and long-term income |
| Agreed term extension | Gives more time for a credible repayment plan | Lender agreement, age criteria and affordability |
| Standard repayment refinance | Pays off the balance over a new fixed term | Affordable capital-and-interest payments |
| RIO refinance | Replaces a fixed maturity with monthly interest borrowing | Sustainable retirement income and survivor affordability |
| Lifetime mortgage | May clear the existing debt without regular payments on a roll-up plan | Available borrowing, interest growth, fees and benefits |
| Downsize or sell | Uses sale proceeds to repay capital | Moving costs, suitable housing and timing |
When RIO or an extension might work
RIO can suit someone with reliable retirement income who wants to remain at home and can comfortably pay interest. The capital remains owed and is normally repaid following the last borrower’s death or permanent care move under the loan terms. Missing required payments puts the home at risk.
An extension is a negotiation with your current lender, not a right to keep borrowing indefinitely. A lender may require a credible repayment strategy or a switch to capital-and-interest payments. Compare the future monthly commitment and end date rather than focusing only on getting past today’s deadline.
When a lifetime mortgage might be considered
A lifetime mortgage can sometimes repay the old balance and remove a compulsory monthly payment, but eligibility and the available loan depend on age, property and product criteria. If the new facility is smaller than the mortgage and costs to clear, the difference needs to come from another source.
Unpaid interest compounds, reducing the estate’s equity. Check moving rights, repayment charges, household occupants and effects on benefits or care funding. Do not borrow extra cash simply because it is available. A specialist adviser should compare alternatives before recommending this route.
Prepare for a useful conversation
If refinancing is not suitable, a planned sale can give more control than waiting until a lender takes action. Ask for support early; do not stop paying or commit to an expensive short-term loan without a realistic exit.
- Mortgage statement, redemption figure and maturity date.
- Pension statements, other income and a realistic household budget.
- Details of other debts and funds available to repay capital.
- Approximate property value and information about anyone living with you.
- Your plans for staying, moving, family support and future care.
Common questions
Will my lender automatically extend the term because I am over 65?
No. Any extension needs the lender’s agreement and may involve affordability checks and a credible repayment plan. Contact the lender before maturity rather than assuming the term will continue.
Can a lifetime mortgage clear the whole balance?
Only if the approved borrowing, together with any other funds you contribute, covers the existing mortgage and relevant costs. Available borrowing varies with the property, age and product criteria.
Sources and further reading
- FCA: interest-only mortgages — act now (opens in a new tab)
- MoneyHelper: what is equity release? (opens in a new tab)
- MoneyHelper: retirement interest-only mortgages (opens in a new tab)
Product terms and support schemes can change. Check the linked guidance and obtain an illustration for your own circumstances.
