At Pure Retirement we’re committed to providing great service both to advisers during the KFI-to-completion process, and also to our customer base throughout the term of their plan, through our Mortgage Servicing Team. However, we appreciate that our responsibilities don’t end there and that, owing to the nature of a lifetime mortgage, it’s up to us to engage with a customer’s estate in the event of their death.
As a result, we’ve created our Property Management Team. For some of you, this might be the first you’ve heard of this side of our business, so we felt it was worth explaining our role in the process, and what this means in terms of the wider customer experience.
Enhancing our service offering
The Property Management Team was introduced to the Mortgage Servicing Team just over a year ago, with the principle aim of providing support and guidance to family members and solicitors following the death of the final customer, or when the final customer moves into permanent long term care, assisting them in finding a suitable solution.
When it comes to lifetime mortgages, once the final customer dies or moves into permanent Long Term Care (LTC) the mortgage conditions stipulate that the mortgage must be redeemed within twelve months from the date of final death or entry into LTC. A number of avenues exist for customers regarding the options available to redeem the lifetime mortgage:
- Sale of property – this can be via the property market or a private sale
- Re-finance the property and keep within the estate or family – an example of this would be to use the assets in the estate to repay the redemption balance
- Voluntary surrender – this is where the executors or Power of Attorney (POA) sign over the property to the lifetime mortgage provider to sell the property on their behalf. This option is often chosen when the property is in a negative equity position
Achieving best outcomes
In each case we work with the estate to facilitate the best course of action, up to and including assuming responsibility for the property. During the last year, there have been a number of firsts for Pure Retirement which have enabled the Property Management Team to manage all of our cases with the care and attention required. These have included:
- Applying the No Negative Equity Guarantee (NNEG) to accounts, resulting in a shortfall sale (accepting less than the outstanding balance to redeem the loan), meaning that the estate or POA are not liable for any loss incurred following the sale
- First property brought into possession via the voluntary surrender route – in total we have brought over 30 properties into possession to assist the estate/POA during what is a difficult time for the family
- Successfully implemented regular third party review meetings to maintain a good level of oversight of our third party suppliers
- First repossession sale, resulting in a surplus which went back to the estate
- Introduction of an invoicing process to reimburse Pure Retirement monetary outlays from funders
