"As the typical profile of later life lending customers evolve, so too must the range of products available to them on the market."
- Kay Westgarth, sales director at Standard Life Home Finance
Standard Life Home Finance has expanded access to its Horizon Interest Reward product by introducing a brand new 25% interest served option and a facility for customers to be rewarded larger rate discounts ranging from 0.03% to 0.75%.
Launched in January, the Horizon Interest Reward product offers a rate discount for customers who commit to making set monthly interest repayments for a specified term of their lifetime mortgage. Horizon Interest Reward is aimed at equity release customers who can commit to making regular payments instead of the traditional voluntary model.
The introduction of a new 25% option will give a greater number of customers access to the benefits offered through the plan. Customers who commit to agreed regular payments will unlock discounts that vary depending on the percentage of the interest served and the length of the contractual term. By servicing 25%, 50%, 75%, or 100% of the interest over a set time, customers can reduce their cost of borrowing.
For example, if a customer commits to servicing 25% of the interest on a Horizon 300 plan, that customer could enjoy a rate discount of over 0.03% in five years, 0.06% in 10 years, and 0.09% in 15 years. On the other end of the scale, a 100% interest payment could yield a 0.75% discount in 15 years. These plans are open to applications from any customer between the ages of 55 and 84.
The offering will still include a standard no negative equity guarantee and customers will have the option to make additional voluntary partial repayments. Up to 10% of the initial loan can be paid back in a non-overlapping 12-month period with no additional ERCs.
Kay Westgarth, sales director at Standard Life Home Finance, said: “As the typical profile of later life lending customers evolve, so too must the range of products available to them on the market. This latest update to our Horizon Interest Reward product will enable even more homeowners to reap the benefits of lower interest rates and larger discounts.
"The next generation of homeowners are likely to lean on later life lending to support their mortgage repayments throughout their life, and so we are committed to offering flexible and affordability-centred options. Advisers play a crucial role in laying out all of the options available to customers to make sure people take out the right products that meets their personal needs.”
