Retirement Property Service Charges and Affordability
At Rockhopper Later Life Finance we help customers aged 55 and over weigh up the ongoing costs of a retirement property. Retirement flats and age-restricted developments usually carry service charges, and sometimes ground rent and event or exit fees, on top of any mortgage. Lenders take these costs into account when they assess affordability, and they are worth understanding fully before you commit.
We work with customers who:
- Are considering a retirement flat and unsure how the charges affect affordability
- Already own a retirement property and find the charges rising
- Want to understand how lenders treat service charges in their assessment
- Are comparing the total cost of a retirement scheme with a standard home
- Are concerned about event or exit fees on a leasehold retirement flat
- Want to plan for charges continuing throughout retirement
- Are helping a relative assess a retirement scheme
Retirement scheme charges can feel hard to pin down, and it is not always obvious what they cover or how they change over time. We help you see the full picture of monthly and one-off costs alongside any mortgage, so the affordability of the move is clear before you decide.
Retirement schemes usually charge a service charge that covers communal areas, building maintenance, and services such as a house manager or emergency call system. Some also carry ground rent, and many leasehold retirement flats include event or exit fees that become payable when the property is sold or changes hands.
Lenders include service charges and ground rent in their affordability assessment, which reduces the amount you can borrow compared with a property that has no such costs. Some lenders are cautious about schemes with high charges or significant event fees, so the choice of lender can depend on the scheme itself.
Event fees, sometimes called deferred or exit fees, are set out in the lease and can affect both the resale value and a lender’s appetite. Understanding how they are calculated is important, and the terms vary between developers and schemes.
We provide mortgage advice. The lease terms, including any event fees, are a legal matter, and we may suggest you ask your solicitor to review them. Where a retirement scheme is not the right fit, your adviser will discuss the alternatives.
The Process
Your first conversation is an informal discussion about the scheme you are considering, its charges, and your circumstances. The more detail you can share about the service charge and any event fees, the clearer the affordability picture.
We complete a full fact-find, include the scheme charges in the assessment, and identify which lenders are comfortable with the property. We then provide a written recommendation.
Every scheme is different. A development with modest charges is assessed differently from one with substantial event fees, and our advice reflects that.
Speak to a Retirement Property Specialist
Call 0203 621 5696
Lines open 9am to 5pm Monday to Friday. Alternatively, complete the enquiry form and we will call you back at a time that suits you.