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Retirement interest only mortgages

A mortgage for life with interest only payments

What are retirement interest only mortgages?

A retirement interest only mortgage or RIO is a mortgage that lets you pay the interest on a monthly basis, without reducing the original amount (capital) you have borrowed. It is only available to people who are over the age of 50 and has been designed to help older borrowers who may struggle to get a standard residential mortgage.

They’re very similar to standard interest only mortgages, but with some key differences. With the majority of retirement interest only mortgages in the UK, you only repay the loan when you sell your property, move into full-time care or pass away. 

Similarly to a standard mortgage, you’ll have to prove you can afford the monthly interest repayments. To take out a retirement interest only mortgage, it's worthwhile getting expert advice from an independent qualified mortgage adviser. That’s where the experienced team at Key can help.

Our award-winning service saw us named the Best Later Life Broker by Financial Reporter in 2018 and 2020. We have also been rated excellent on Trustpilot by over 15,000 customers, so you know you’re in good hands. Request a callback from one of our experts today or call 0808 252 9170.


How do retirement interest only mortgages work?

It’s important to consider if a retirement interest only mortgage is right for you.

In March 2018 RIOs, or retirement interest only mortgages, were authorised by the Financial Conduct Authority (FCA) as part of standard mortgages, as they were formerly categorised under equity release. Retirement interest only mortgages can be used for many purposes and, are usually repaid when you or the last remaining applicant either pass away or move into long-term care.

Typically, your house will then be sold and the retirement interest only mortgage provider will take their money from the sale proceeds. The remainder goes to your estate.

What are my options for retirement interest only mortgages? 

As an independent advisory service, our mortgage advisers can search the whole market, including specialist lenders, giving you more options when it comes to later life borrowing.

Whether you’re looking for a standard mortgage or retirement interest only mortgages, our friendly expert mortgage advisers can help you choose the option that’s right for you.

Request a callback from a member of the team or use our later life mortgage finder to better understand what could be available to you.


Our retirement interest only mortgage providers

At Key, we work with a number of later life mortgage* providers. Some of these include names such as Leeds Building Society, LiveMore, Marsden Building Society, Hodge, The Nottingham Building Society and Leek United Building Society.


Advantages and disadvantages of retirement interest only mortgages

If you’re looking at your options and aren’t sure if a RIO mortgage is right for you, here are some of the key advantages and disadvantages for you to consider.


  • You’re able to release funds tied up in your home to pay off existing debt.

  • You may be able to pass on an early inheritance.

  • You won’t have to downsize to a smaller property.

  • Your mortgage can be repaid early (although there may be an early repayment charge).


  • If you have an existing mortgage, that needs to be repaid first.

  • You’ll need to prove you can afford the interest repayments through affordability checks.

  • Your home will usually be sold off to repay the loan when you enter long-term care or pass away.

  • Your home is at risk if you don’t keep up with repayments.

For RIO and retirement repayment mortgages, these products are available through Key Group and we charge an advice fee of 1.99% of the amount released, subject to a minimum of £1,499, usually payable when the mortgage completes.

Remember a mortgage is secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.


Retirement interest only mortgage vs equity release

Although RIO mortgages share some similarities to equity release – they both allow you to access funds tied up in your property – they do have some key differences. With equity release, like any mortgage, you’re essentially borrowing a portion of your property’s value, but don’t necessarily need to make monthly repayments.

For both RIO's and equity release the loan is repaid once you move into long-term care or pass away, and the property is sold to cover this. With a lifetime mortgage, the most popular form of equity release, you don’t typically make repayments and your debt will grow over time and can have a negative impact on the value of your property, however you could opt to make interest repayments with an interest only lifetime mortgage.

Whether you’re considering a RIO or equity release, it’s important to get advice from a qualified expert. Get in touch with the team at Key today to discuss your options further.

What our customers are saying

Good service from start to finish
the whole procedure of dealing with Key was straightforward and thorough. We were told how long to expect it to take and Key kept to their word almost to the day. My wife and I are delighted with the outcome allowing us to more fully enjoy our later years.
colin stone
We couldn't be happier with the service from Key. The initial advice was valuable as we were made completely clear about the advantages and disadvantages of equity release and the product was tailored to our needs. Other professionals involved in the process were very efficient and helpful.
Mrs Wendy Rideout
Everyone we dealt with were very friendly & helpful & everything went through without any problems
Just recently completed our lifetime mortgage with Key, Alex who assisted us with this was helpful and after a few teething problems it was finalised within a few months. Equilaw were recommended and were also very prompt at finalising everything, apart from signing some documents we had little to do which was great for us Thank you we now have...
Sharon r Kennelly

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Things to consider

  • A mortgage is a loan secured against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
  • For our RIO products we charge an advice fee of 1.99% of the amount released, subject to a minimum of £1,499, usually payable when the mortgage completes.
  • You should always think carefully before securing a loan against your home.
  • Key Equity Release offer lifetime mortgages only, which is a loan secured against your home. It will reduce the value of your estate and may affect your entitlement to means-tested benefits.
  • You have to get expert equity release advice before releasing tax-free cash from your home - please read all our information and make sure it’s right for you.
  • All of Key Equity Release's lifetime mortgage plans meet the Equity Release Council standards and come with several protections, including the no negative equity guarantee, which means you’ll never owe more than your home’s value.
  • With a lifetime mortgage there are typically no monthly repayments to make as the loan, plus interest, is repaid when the plan comes to an end.
Page last updated: Monday 20 December 2021