Over-65s mortgage on the way

Equity release company SHIP Ltd is to launch a mortgage for people over the age of 65.

The new product will allow over 65s to borrow between 20% and 40% of the current value of their homes depending on their age.

The "interest roll-up" mortgage, means there are no repayments during the lifetime of the loan. Capital and accumulated interest is repaid on the death of the homeowner or the last survivor in the case of a couple. Interest accrues at a fixed rate currently set at an APR of 6.35%.

The interest rate is fixed for life. The new product will be available from January.

SHIP Ltd was established in 2003 by the former chief executive of Irish Permanent, Billy Kane.

Mr Kane said: "Most people would have paid off their mortgage by the time they get to 65, but can't at that age approach most banks for more money. This is an equity release product for those people."