Your guide to Aviva for intermediaries

Got clients who want to use the equity in their homes? Aviva for intermediaries might be the right one for them. Check out their equity release options here

By Kath Villamayor

29 Oct 2024

Contents

Getting to know Aviva for intermediaries
Products and services offered by Aviva for intermediaries
Benefits of Aviva’s lifestyle mortgage
Disadvantages to Aviva’s lifetime mortgage
Aviva for intermediaries’ eligibility criteria
Going for Aviva for intermediaries’ equity release options

Mortgage brokers or intermediaries in the United Kingdom help connect those who want to achieve their dream of homeownership with competent mortgage lenders. They also aid potential borrowers in finding the best mortgage products by introducing them to numerous mortgage offerings that are available in the market. Intermediaries can have access to a broad selection of real estate loans with affordable interest rates by working closely with commercial banks and other lending institutions.

However, there are companies that are not entirely focused on loans but can still provide mortgage options to applicants. For instance, Aviva for intermediaries is not entirely a mortgage lender and still, they can guide intermediaries in meeting the specific needs of their clients. Mortgage brokers can also help their prospects secure targeted mortgage solutions and assist them throughout the mortgage application process.

In this article, Mortgage Introducer will talk about Aviva for intermediaries and how they can help mortgage brokers in the country with their client-focused products and mortgage tools. We will also explore their mortgage services, particularly their equity release selections. Would you like to verify if you have clients who are eligible for Aviva’s property loans? Read on for more.

If you are a financial adviser or an aspiring one, you might also want to check out this overview of Aviva for intermediaries.

Getting to know Aviva for intermediaries

Aviva is a multinational insurance provider in the UK. They are the fourth largest insurance company by market capitalisation. Aviva is also listed on the London Stock Exchange and is a constituent of the Financial Times Stock Exchange 100 Index. Here are some of their insurance products:

car insurance
home insurance
life insurance
business insurance
travel insurance
personal accident insurance

Despite focusing on insurance, Aviva PLC also offers investments, savings, and Individual Savings Accounts (ISAs) such as:

stocks and shares ISA
Wealthify Junior ISA
Aviva Pension
savings accounts
investment accounts
investment bonds
investment funds

Aviva mostly provides support for financial advisers to help their clients plan for the future, save, and achieve financial peace of mind. If you are a financial adviser, feel free to watch this video:

Despite leaning into the insurance sector, Aviva can also provide home loan solutions for mortgage brokers and their clients. Newcomers and seasoned brokers in the business ca greatly benefit from working with Aviva, along with other top mortgage intermediaries in the UK.

Aviva for intermediaries is an equity release lender

Aviva for intermediaries prides themselves on being one of, if not the UK's most established and trusted equity release lenders. They are also a member of the Equity Release Council. What does this mean for mortgage brokers who are interested in partnering with Aviva? This means accessing specialised mortgage products, particularly for equity release.

Intermediaries and financial advisors can explore Aviva’s equity release product options rather than the traditional range of mortgage services that most commercial banks and other mortgage providers offer. While Aviva for intermediaries might not have many products for various types of home loan applicants, focusing on equity release options has many benefits. This kind of niche market is great for financial advisors and mortgage brokers who want to level up their game.

For intermediaries with clients who would like to use the equity from their homes, Aviva can help them with retirement funding options and lifetime mortgages.

Learn what equity release is when you watch this clip:

To assist you in better understanding what this kind of home loan is, read this guide to equity release.

Is equity release safe?

Yes. As an equity release provider, Aviva for intermediaries is regulated by the Financial Conduct Authority (FCA). If your clients take out a lifetime mortgage with Aviva, their estate will never have to pay back more than their home can be sold for. This is as long as their property is sold for the best price reasonably obtained.

Products and services offered by Aviva for intermediaries

Aviva for intermediaries only offers lifestyle mortgages for eligible clients. Their Lifestyle Flexible Option offers either a one-off cash lump sum of £15,000 or more tax free, or a one-off cash lump sum of £10,000 or more with a cash reserve of £5,000 or more.

Perks of cash reserve

Aviva’s cash reserve offers flexibility for your clients to draw money as and when they need it. Your client will pay only the interest on the cash they draw down—making this a cost-effective option. As a general rule, the cash that your clients will release is not subject to tax. However, there might be tax implications based on how your clients will spend said cash.

As for the property at hand, your clients will still be its owners. They are permitted to reside in it until the end of their lifetime or move into long-term care. This is subject to Aviva for intermediaries’ terms and conditions. This applies to both borrowers on joint lifetime mortgages.

Learn what lifetime mortgages are when you watch this video:

Trivia: do you know that lifetime mortgage customers are getting younger? The latest market trends show a decrease in the average age of borrowers and a growing preference for drawdown plans.

Benefits of Aviva’s lifestyle mortgage

Aviva for intermediaries offers voluntary partial payments to successful lifetime mortgage applicants. Each policy year, your clients can choose to repay up to 10% of the initial loan. They can do this without any additional borrowing and any cash reserve releases without incurring an early repayment charge. There is also no limit on the number of repayments. Take note, each repayment must be at least £50.

Interest rates are guaranteed for 14 weeks as provided in Aviva’s offerings if your client’s application is accepted. If the loan is not completed within this time, Aviva will review your client’s case. Finally, Aviva will issue a reoffer will on existing rates. These rates are guaranteed for the next 14 weeks.

Disadvantages to Aviva’s lifetime mortgage

During the home loan period, Aviva for intermediaries will charge the interest on the amount borrowed plus interest already added. This will increase the money owed by your clients in no time. Releasing equity will reduce the amount of inheritance your client can leave and may affect their eligibility for certain welfare benefits.

Here are other disadvantages to Aviva’s lifetime mortgage:

Large interest charges

Interest is charged on the total amount borrowed by your clients. Aside from that, there is also interest already added. As a result, the debt that your clients owe can speedily increase.

Risk of less inheritance left

Paying off the amount released through the lifetime mortgage plus interest incurred means that your clients are leaving less for their heirs or loved ones. The same is true even if your clients set aside a percentage of their property’s value.

Tax implications

Taking cash out of your clients’ property through Aviva for intermediaries’ lifetime mortgage is open to a risk of tax implications. This can also affect whether your clients can apply for certain welfare benefits.

As an added support for you and your clients, Aviva will assign an equity release adviser to go through this process.

Expensive penalties for early repayment

Aviva for intermediaries’ equity release is designed to last for the rest of your client’s life or until they need long-term care. If your clients change their minds and they decide to pay the lifetime mortgage earlier, they might face a big early repayment charge.

Additional costs for legal advice

Your clients are also required to seek legal advice. As such they will need to prepare for extra charges.

Aviva for intermediaries’ eligibility criteria

Since Aviva only offers lifetime mortgages, the eligibility criteria must be strictly complied with. As for the applicants’ property, it must be valued at £75,000 or more. To apply for a lifetime mortgage, applicants must be:

55 years old or above; this applies to both borrowers in joint life cases
living permanently in their property (for joint applications)
live in England, Scotland, Wales or Northern Ireland; this excludes the Channel Islands or Isle of Man
be able to borrow at least £15,000

All applications submitted to Aviva will be subject to the following:

valuation
legal checks
full underwriting

Do you know that potential home buyers and sellers have more advantage in personal underwriting? Discover why when you read this article.

Accepted properties

Aviva will accept houses that are in need of repairs as well as properties where proposed building works have not yet started. Properties which are in the course of construction or pre-construction will also be accepted by Aviva for intermediaries.

For loan size, Aviva set quotations for loans of £1,000,001 and above.

Disqualified properties

Aviva for intermediaries will not accept properties that are:

in poor condition
already undergoing substantial repairs, changes, or extensions
cluttered with an ‘unacceptable’ amount of stored goods
poorly maintained at the time of the valuation inspection

Going for Aviva for intermediaries’ equity release options

Aviva for intermediaries might not cater to all types of clients but they specialise in a particular niche market. Their equity release options are perfect for homeowners in the UK who want to maximise the equity of their properties.

However, if your clients do not meet the specific requirements that Aviva for intermediaries has set, feel free to check out other mortgage lenders. There are also a lot of home loan providers that offer intermediary-only platforms. These exclusive websites are designed so that they can provide the best service to their partner brokers. Here is a compiled list of other guides to mortgage lenders that you might want to know further:

What do you think about this overview of Aviva for intermediaries? Share your thoughts in the comments below.

Your guide to Aviva for intermediaries

Getting to know Aviva for intermediaries