What if you never had to repay your interest-only mortgages?
For many landlords, the inevitability of eventually having to repay mortgages was never regarded as the best outcome, just the default one.
At one point, you probably did have a plan; most likely something along the lines of sell a few properties at retirement, clear some debt, and simplify things over time. That’s perfectly sensible, and for many landlords, that was the intention. However, portfolios evolve, values rise, rents increase, income becomes more important than capital, CGT needs to be considered, and what once looked like a tidy “exit strategy” can start to feel like an unnecessary disruption.
The problem isn’t the mortgages; it’s the timing.
Interest-only borrowing did exactly what it was supposed to do; it helped you build, but now you might be in a different position. What if the mortgage on your own home is coming to the end of the term and most lenders are not interested because you’re getting too old?
You’re faced with a decision that doesn’t quite fit anymore
Do you stick to the original plan and start selling rental properties?
Do you downsize you home?
Or do you step back and ask a more relevant question: Does this debt actually need to be repaid during my lifetime?
For many landlords, that is where the thinking has shifted.
This is where later life lending comes in – NOT Equity Release – that’s different
Lenders like Livemore are approaching this from a completely different angle; no fixed “end point” based on age, and no assumption that capital must be repaid within a set term. Instead, they look at whether your income supports the costs of borrowing, e.g. rental profits from your portfolio and pension income, whether current or projected. If that income comfortably services the debt, the mortgage can continue for the rest of your life, not as a workaround but as the intended structure.
That opens up a very different set of choices
You are no longer locked into selling assets at a time that suits the lender, triggering CGT simply to meet a deadline, downsizing your home or reducing income to reduce debt. Instead, you can choose to keep the portfolio intact and let it do what it already does well, generate income. The loan is then typically repaid from your estate in due course.
This isn’t about avoiding responsibility
The debt still exists, it is still serviced, and it is still ultimately repaid. What changes is when and how that happens. For many landlords, that shift alone is enough to transform the conversation.
Plans change; your financing should too.
What made sense 15 or 20 years ago may not be the best option today, not because the original plan was wrong, because your position is now stronger: more assets + more income = more options. The mistake is assuming you still have to follow a plan that no longer fits.
If this is starting to resonate you are not alone. We are seeing more landlords reach this point, where the portfolio is working, but the lending structure is starting to feel out of sync. The key is to look at your options before you are forced into a decision.
A conversation worth having
If you are weighing this up, it is worth having a proper discussion about what later life lending could look like in your situation.
It may also be worth taking a closer look at how your portfolio is structured as a whole.
These conversations are typically most useful for landlords with established portfolios and relatively modest borrowing who are beginning to reflect on how their assets could work more effectively in the years ahead.
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20) Am I missing a trick?
Member Since June 2013 - Comments: 381 - Articles: 61
4:17 PM, 24th March 2026, About 1 month ago
Reply to the comment left by Mark Alexander – Founder of Property118 at 23/03/2026 – 11:22
Here is a list of lenders who offer BTL mortgages, and their max age at the end of the mortgage contract term (this list is correct as at todays date and subject to the lenders criteria which can change from time to time);
BATH BUILDING SOCIETY no max age
BUCKINGHAMSHIRE BUILDING SOCIETY no max age
CAMBRIDGE BUILDING SOCIETY no max age
CASTLE TRUST no max age
DARLINGTON INTERMEDIARIES no max age
DUDLEY BUILDING SOCIETY no max age
FOUNDATION no max age
GATEHOUSE BANK no max age
HAMPSHIRE TRUST BANK no max age
HARPENDEN BUILDING SOCIETY no max age
HSBC no max age
KENSINGTON MORTGAGES no max age
KEYSTONE PROPERTY FINANCE no max age
LEEDS BUILDING SOCIETY no max age
MANSFIELD BUILDING SOCIETY no max age
MARKET HARBOROUGH BUILDING SOCIETY no max age
MELTON BUILDING SOCIETY no max age
NEWCASTLE FOR INTERMEDIARIES no max age
PENRITH BUILDING SOCIETY no max age
QUANTUM MORTGAGES no max age
SAFFRON FOR INTERMEDIARIES no max age
SUFFOLK BUILDING SOCIETY no max age
THE MORTGAGE WORKS no max age
TOGETHER no max age
WEST ONE LOANS 105
LENDCO 100
BM SOLUTIONS 99
MT FINANCE 96
FLEET MORTGAGES 95
LANDBAY 95
LENDINVEST 95
SHAWBROOK BANK 95
THE MORTGAGE LENDER 95
ZEPHYR HOMELOANS 95
FAMILY BUILDING SOCIETY 94
CHORLEY BUILDING SOCIETY 90
LEEK BUILDING SOCIETY 90
NEWBURY BUILDING SOCIETY 90
ACCORD MORTGAGES 85
AFIN BANK LIMITED 85
ALDERMORE 85
CHL MORTGAGES 85
COVENTRY BUILDING SOCIETY 85
HINCKLEY AND RUGBY BUILDING SOCIETY 85
INTERBAY COMMERCIAL 85
METRO BANK 85
MODAMORTGAGES 85
MOLO FINANCE 85
MONMOUTHSHIRE BUILDING SOCIETY 85
NOTTINGHAM BUILDING SOCIETY 85
OCTOPUS REAL ESTATE 85
PARAGON MORTGAGES 85
PEPPER MONEY 85
RELY MORTGAGES 85
SANTANDER 85
SKIPTON BUILDING SOCIETY 85
STAFFORD BUILDING SOCIETY 85
SWANSEA BUILDING SOCIETY 85
UNITED TRUST BANK 85
VERNON BUILDING SOCIETY 85
VIDA HOMELOANS 85
VIRGIN 85
SKIPTON INTERNATIONAL 84
BANK OF IRELAND 80
BARCLAYS 80
BEVERLEY BUILDING SOCIETY 80
HANLEY ECONOMIC BUILDING SOCIETY 80
MERCANTILE TRUST 80
NATWEST 80
STATE BANK OF INDIA 80
TSB 80
FURNESS BUILDING SOCIETY 79
CLYDESDALE 75
Hope that helps
Member Since January 2011 - Comments: 12212 - Articles: 1408
4:29 PM, 24th March 2026, About 1 month ago
Reply to the comment left by Howard Reuben – mortgage and insurance broker at 24/03/2026 – 16:17
That’s very informative Howard, thank you.
I understand that the maximum age at application is the biggest problem due to most lenders pegging this at age 75.
Member Since June 2013 - Comments: 381 - Articles: 61
6:50 PM, 24th March 2026, About 1 month ago
Reply to the comment left by Mark Alexander – Founder of Property118 at 24/03/2026 – 16:29
yes, many lenders do, but not all thankfully. 23 on my list have no max age at application, 2x have a cap at age 90, and another 20 or so allow 80-89 year olds to apply as well.
Some of these maximum ages however apply only for Ltd Company borrowers where a joint borrower is younger.
The BTL lending world has indeed become a lot more understanding over recent years as to why people bought BTL’s in the first place, ie as an alternative ‘pension’.
There are, however, caveats and other criteria limitations imposed on a case by case basis. As we all know, age is not the only factor and there are always many other risk factor hoops to jump through for each application.
Always work with an expert and knowledgeable professional mortgage broker 🙂
Member Since July 2017 - Comments: 462
8:53 AM, 29th March 2026, About 4 weeks ago
We both took out a RIO mortgage about a year ago. Got a very good interest rate of 4.5%. Good because we both had active LPA’s and the Building Society offred better rates. So what did we do with the money? We both bought purchased life annuities and got over just 9% return. (Annuities historically quite high) We could have got a higher rate still but we went for 3% escalating. End result we are now getting about £2,000 more every month more than we are paying out on our mortgage. Most of our annuiities are tax free as counted as return of capital.
Member Since January 2011 - Comments: 12212 - Articles: 1408
10:07 AM, 29th March 2026, About 4 weeks ago
Reply to the comment left by Dennis Forrest at 29/03/2026 – 08:53
This is an interesting strategy; borrow at one rate and get an inflation-linked return on the cash at twice the rate.
Many of the landlords we consult use this strategy, albeit with alternatives to buying a lifetime annuity. However, their strategy is usually only accessible to high-net-worth individuals and sophisticated investors such as established portfolio landlords.
Member Since January 2011 - Comments: 12212 - Articles: 1408
11:23 AM, 29th March 2026, About 4 weeks ago
Reply to the comment left by Dennis Forrest at 08:53
Further points: equity does not pay for holidays, treats for the grandchildren, or put food on the table. It does tend to grow over time, but only if you keep the property. Even then, without properly planing, up to 40% eventually ends up in the hands of HMRC and the remaining 60% in the hands of your beneficiaries. It’s not improving cashflow and lifestyles now though is it? Nor is it buying memories.
Member Since July 2017 - Comments: 462
8:29 PM, 29th March 2026, About 4 weeks ago
Reply to the comment left by Mark Alexander – Founder of Property118 at 11:23
The other point of my strategy, perhaps I should have pointed it out, is of course to minimise inheritance tax. It creates a permanent debt on our main property which never reduces, we just just pay interest for the rest of our lives. At the same time we enjoy an increased income of the rest of our lives. There is no guarantee of any capital return on our annuities. I planned it that way, If we got any guarantee of any payback not only would the percentage yield be lower but the money goes back in the pot for inheritance tax. Our mortgage is just over £1300 per month. My annuity is around £1400 per month, my wifes annuity is about £2,000 per month. If i die first which is likely because I am male and 1 year older than my wife who is less astute financially, (she won’t mind me saying this) she will have a huge margin between here increasing annuity and the monthly mortgage payments, If she goes first I will manage just fine. While we are both alive we are at least £2,000 per month better off. We both have mothers that lived well in to their nineties. A word of caution for anyone applying for a RIO mortgage. You are not not supposed to use the money for any kind of investment. You can spend it on a major house extension or even frivolous things like an expensive new car or a 3 month round the world cruise. The last two options were the ones I chose to tell my lender. I did not want to take the risk of being refused even if they realised that my investment was 100% secure. After all Rules are Rules, aren’t they. In conclusion – it always pays to think ‘outside the box’ – always legally of course
Member Since January 2011 - Comments: 12212 - Articles: 1408
8:46 PM, 29th March 2026, About 4 weeks ago
Thank you for sharing your strategy. We can’t take it with us!
We are hopeful of being able to bring RIO lending to the UK but to let market, but even now, as Howard confirmed in an earlier comment, there are buy to let lenders who will lend on 40 year interest only terms against BTL properties, even to landlords in their 80’s. They EXPECT the funds to be invested, so no lies are necessary. There are also other forms of investment that can pay an 8% to 10% coupon, but usually accessible only to HNW individuals and sophisticated investors by invitation only.
Member Since July 2017 - Comments: 462
9:25 PM, 29th March 2026, About 4 weeks ago
Reply to the comment left by Mark Alexander – Founder of Property118 at 20:46
Of course there are lots of renewable energy companies investing in wind or solar offering yields of around 10%. IMO oversold and still an attractive investment. The Iran situation reinforces that you cannot always depend on oil for energy.. If included in a high yield ISA, portfolio can produce a very attractive tax free income. Our own self select ISAs are currently producing a tax free yield of just over 7%. We don’t invest for tax free capital gains (IHT reasons) just for income. We can easily give away surplus income but not surplus capital. (PET and a 7 year wait). We currently have a portfolio of 68 shares, Besides renewables we invest in tobacco, insurers, banks, REITS, etc and a few investment trusts. I have been investing directly in the stock market for the last 55 years. It has been a very profitable hobby. More profitable and a lot less hassle than property investment. Of our 68 shares only 6 did not recently increase the dividend and only one reduced the dividend. Lot of work – no, not really. Pick good shares if they do not cut the dividend then just keep them. I they cut the dividend, then sell them straight away and buy something else, We only had one bad one in the last 12 months, WPP halved its interim dividend and it was sold straight away at a loss and another share bought instead,
Member Since January 2011 - Comments: 12212 - Articles: 1408
9:34 PM, 29th March 2026, About 4 weeks ago
Reply to the comment left by Dennis Forrest at 29/03/2026 – 21:25
I’m happier with loan notes. Interesting that you mentioned energy because I was looking at Octopus just the other day. Shares are not for me though. I prefer property, lending and what I regard as certainty. It’s all about priorities and attitude to risk I suppose. I’m always happy to debate strategies though because nobody has a monopoly of good ideas.