A retired Surrey homeowner faced a choice many people in later life have to make. He could continue paying £1,193 a month across multiple high-interest debts, or he could consolidate and free up cash to do something he’d been planning for years: travel. At 74, with over £50,000 of renovation, solar panel and car finance debt accumulating interest at rates as high as 11%, he needed a retirement interest only mortgage for debt consolidation that would reduce his monthly outgoings without creating a future repayment burden.
What was the situation?
The Surrey homeowner had recently spent significant money improving his property. New solar panels had been installed. Renovation work had been completed. The total cost had been spread across several credit agreements, each with its own interest rate and monthly payment. On top of that, he had a £19,000 car finance agreement.
His income came from a state pension and a private pension. The property was worth £850,000 and mortgage-free. The debt wasn’t unmanageable, but it was expensive and restrictive. He wanted to consolidate everything into one payment, reduce his monthly commitments, and access some additional funds to support his travel plans in retirement.
He had spoken to several brokers already. None had offered a solution he felt comfortable with.
What was the challenge?
Age is often treated as a barrier in mortgage lending. Many mainstream lenders impose upper age limits or require full repayment by a certain birthday. For a 74-year-old borrower, that creates a narrow field of options.
The total debt narrowed it further. Most lenders cap how much they will allow for debt consolidation, and his borrowing went beyond that limit.
The client was also not comfortable using computers. Gathering documents, submitting evidence, and navigating a digital application process would have been difficult without support. Several brokers he’d approached had either quoted uncompetitive terms or failed to explain the structure clearly.
The challenge was to find a lender willing to offer a competitive rate on a retirement interest only mortgage, structure the loan to clear all of his debt, and provide the level of personal service required to keep the process straightforward.
It has been a pleasure dealing with James at Oakstead Finance he has always got time to explain everything and keep everything running smoothly I would throughly recommend James.
What did we do?
After the initial meeting, we assessed the client’s income and expenditure in detail. His pension income was sufficient to service a retirement interest only mortgage comfortably. This type of mortgage allows borrowers to make monthly interest payments without ever having to repay the capital. The loan is repaid when the property is sold, typically after the homeowner passes away or moves into long-term care.
We sourced a lender offering a five-year fixed rate at 5.79% with no product fee. That compared favourably against the 11% APR on some of the existing credit agreements. The loan amount was set at £120,000, enough to clear all existing debt and provide additional funds for travel.
Because the client was not computer literate, we arranged hard copies of all required documents. Every piece of evidence was printed, posted, or collected in person. We walked him through the structure of the mortgage, the monthly cost, and what would happen at the end of the fixed term. No pressure. No jargon. Just clarity.
From application to offer took just 15 working days, which kept the process quick and stress-free for the client.
What was the outcome?
Monthly outgoings dropped from £1,193 to £579. That’s a reduction of £614 a month, more than £7,000 a year. The client had cleared all his debt, secured a competitive fixed rate, and freed up additional funds to support his retirement plans.
The mortgage has no end date. He will make interest payments for as long as he lives in the property, with no requirement to repay the capital during his lifetime. When the property is eventually sold, the loan will be repaid from the proceeds.
He later told us that we were not only the most competitive broker he’d spoken to, but the only one who had taken the time to explain everything properly without trying to rush the sale.
If you’re retired and looking to consolidate debt, release equity, or reduce your monthly outgoings, we can assess your options and find the most suitable lender for your circumstances.
