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Background

Canada Life was created through MGM Advantage’s re-brand which took place in 2015 following its acquisition of the former equity release lender, Stonehaven Equity Release. Then, later known as Retirement Advantage.
Their roots date back to 1852 and has stayed consistent in maintaining a portfolio of retirement products that can be tailored to the individual needs of each consumer. The current range of equity release products offer a customizable approach to managing finances during retirement.

Canada Life focuses on three main groups of products. These are the range of Lifestyle Options, Interest Select Options and Voluntary Select Options. Each lifetime mortgage product also comes the option of additional borrowing that can be paired with any of the Canada Life lifetime mortgage schemes.

There are products to suit each homeowner’s needs. Some products allow for homeowners to make payments, which could be monthly or ad-hoc, while other schemes do not require any payments at all. Additionally, some products will offer cashback and drawdown options. With the three portfolios of products, each consumer is able to find a product that will fit their individual equity release needs.

Despite the uniqueness with each of these lifetime mortgage products, there are also standard features associated with all of them. These include a No Negative Equity Guarantee, cash reserve facility, ability to port the loan, avoidance of repossession and retention of 100% of the home ownership. They are also members of the fixed early repayment charge (ERC) regime, whereby NO ERC’s exist after the 8th year. Therefore, for homeowners looking for defined penalties like conventional mortgages, the Canada Life range of plans would be ideal.

Lifestyle Options

The suite of Lifestyle Options products also includes options for those homeowners who are interested in low interest rates, or want high loan-to values and/or a capital repayment facility. These Canada Life products are also attractive to those consumers who do not want to be under any obligations in making repayments since no payments are due with the Lifestyle Lump Sum Options products. Instead, these are traditional roll-up lifetime mortgages with a fixed interest rate from the outset.

Canada Life Lifestyle Options Plans offer consumers a one-time lump sum payment which they can use the funds on whatever they’d like without restriction. There is no cashback available with this suite of products. If homeowners are looking for a cash back option, it is available with other products offered by Canada Life, such as with one of the Interest Select or Voluntary Select products.

Interest Select Options

The suite of Interest Only Lifetime Mortgage products is most suitable for homeowners who want to pay some, or all, of the interest accruing on their loan. So for those homeowners who are concerned about accruing too much interest, this is an attractive product. There is no affordability evaluation made with this suite of products and homeowners have the option to take either a cashback option of add a cash reserve facility to the product. The payments with these products is fixed and occur on a monthly basis.

An extra level of protection comes with the Interest Select plans with the Early Repayment Waiver. This feature is effective should one homeowner die, or move into care on a joint application. If either situation arises, then the survivor is able to repay the Canada Life Lifetime Mortgage with no penalty.

Voluntary Select Options

The Voluntary Select products are a subtle mix of the Interest Select Products and Lifestyle Options. With these products, homeowner can choose to make a contribution each year if they want to do so. There is no obligation, but rather the consumer has the choice as to whether they want to make a contribution toward their loan balance of upto 12.5% of the original amount borrowed. Any of these voluntary payments, within the 12.5% limit will incur NO early repayment charge.

The Voluntary Select plans also have the protective feature of the Downsizing Protection Option which allows homeowners who downsize in the future the opportunity of repaying the lifetime mortgage at that point with NO penalty also.

In addition, there is the option with all these products to borrow additional money. Consumers can opt to take additional funds after they have already confirmed their initial loan of they can opt to add a cash reserve facility right at the original outset of the loan.