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Retirement Interest Only mortgages

Borrow into later life through a Retirement Interest-Only mortgage.

You could free up some funds in retirement by taking out a Retirement Interest Only mortgage. Often known as RIO mortgages, they allow you to take out a loan against the value of your home. You then repay the interest every month, but not the capital of the loan.

The loan amount tends to be repaid when your home is sold. This could be when you pass away or move into long-term care.

As with any mortgage, the loan will be secured against your home. If you don't keep up with your monthly payments, your home may be repossessed.

Could a RIO mortgage work for you?

Saga Mortgages can help you explore Retirement Interest Only mortgages and other later life lending options. We partner with Tembo, who are an award-winning digital mortgage broker. They provide expert advice and access to hundreds of mortgage deals.

It’s quick and easy to see your mortgage options. Register your details and complete our online fact find. You'll then see examples of relevant products, costs and interest rates.

If you’re eligible, we’ll also invite you to book a free advice session with a mortgage advisor. They will talk through your options in more detail and answer any questions you have. The session is relaxed, and you won’t feel any pressure to proceed.

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What are the benefits of a RIO mortgage?

  • Borrow into later life - Retirement Interest Only mortgages allow retirees and older homeowners to borrow into retirement when age limits can restrict other options.
  • Reduce your monthly costs - You only pay the interest on the loan each month, not the capital. This makes the monthly costs of a Retirement Interest Only mortgage lower than those on a standard mortgage.
  • Access equity in your home - Retirement Interest Only mortgages can provide access to the equity in your property. By freeing up some money, you could pay for travel plans, home upgrades or a loved one’s first home.
  • Stay in your home - A Retirement Interest Only mortgage allows you to unlock equity from your home without having to downsize or move. You can stay in the home you love and access the funds you need.
  • Choose how you repay - Some Retirement Interest Only mortgage deals allow you to repay the capital and the interest – or overpay to reduce the size of your loan. This might help you if you're worried about repaying the loan sum in the future.
  • Move your deal with you - You may be able to move home and port your Retirement Interest Only mortgage. This means your mortgage product transfers to your new home (up to the remaining loan value). This could allow you to avoid any early repayment fees, if you repaid early or remortgaged.

What are the risks of a RIO mortgage?

  • You might not be eligible - Lenders have different age limits for their Retirement Interest Only mortgages. Some require you to be at least 55 years old, while others set the limit at 60 or even higher. If you're not eligible, you could consider a Standard Interest Only mortgage.
  • Limits on affordability - When lenders assess you for a Retirement Interest Only mortgage, they tend to use the salary of the lowest earner in your household. Another option is to consider a Standard Interest Only mortgage, which looks at the affordability of joint applicants instead.
  • Minimum property value - When your affordability for a Retirement Interest Only mortgage is assessed, the value of your property plays a role. Lenders might require a minimum property value, to ensure it provides enough security for the mortgage. If your home's value is too low, you may not be able to get a Retirement Interest Only mortgage.
  • The loan amount remains - As you only pay back the interest each month, the full repayment of the loan is not due until the sale of the property. This tends to be when you move into long-term care or pass away. This could impact how much your loved ones inherit in the future.
  • Interest rates can change - If you choose a deal with a variable rate, your interest rate and monthly payments could change in the future. For example, when you start the loan, you could have an interest rate of 3%. But if the rate rises to 5%, this will increase the amount you pay each month. It’s good to plan ahead and make sure you can afford any rate changes.
  • Impact on benefits - If you take out a Retirement Interest Only mortgage, this could impact the amount of means-tested benefits or pension credit you receive.

Here and ready when you are

Whether you have questions about Retirement Interest-Only mortgages or just want to find out more, the expert team are on hand to help.

0330 018 3071

Mon-Thu 9am-8pm
Fri 9am-5:30pm
Sat-Sun 10am-3pm

Am I eligible?

Frequently asked questions

Here are some of our most frequently asked questions
Who is eligible?

This depends on the lender’s criteria. You normally need to be over the age of 55 or 60. And you need to live in or be buying a property in England, Wales or Scotland.

How much can you borrow?

This depends on your affordability. Some lenders allow you to borrow up to 85% of your home’s value. But some lenders may offer lower than this. Your income will be assessed, as well as your expenses and your credit score.

Do you have to be retired?

No, you do not have to be retired to apply. You could be fully retired, a full-time worker or a part-time worker.

Are Retirement Interest-Only mortgages your only option?

There are alternatives to Retirement Interest-Only mortgages you can consider. For some borrowers, a standard interest-only mortgage may be more suitable as this could allow you to access lower rates, making your monthly costs more affordable.

Borrowers who have a generous pension income and want to remortgage their property, but exceed the maximum age of a traditional mortgage could also consider a Retirement Capital and Interest (RCI) mortgage. This works like a standard repayment mortgage because it has a fixed end date and you repay the debt as well as the interest, but it has a flexible upper age limit based on your life expectancy. 

If you want to release money to supplement your children or grandchildren’s house deposit, you could also consider a Deposit Boost or Savings as Security mortgage. If you are under the age of 60, another way you could help your loved ones get their first home is by becoming their guarantor through an Income Boost.

For others, a lifetime mortgage, or equity release product may be more suitable.

Is a Standard Interest Only mortgage a better option?

With a Retirement Interest Only mortgage, you pay a premium for having a mortgage with no end date. Instead, the mortgage will continue until the property is sold, you pass away, or move into long term care. This can often mean that interest rates on RIO mortgages are higher than a Standard Interest Only mortgage.

If you are eligible for a Standard Interest Only deal, it can be better to go for this option instead of a RIO mortgage to access a lower mortgage rate.

What income sources are assessed?

Lenders tend to assess your earnings from a range of sources including full-time work, self-employment, pensions and rent. Make sure you can show proof through documents like bank statements and pay slips.

Can you move home?

Yes, it’s possible to move house if you have a Retirement Interest Only mortgage. This is good news if you plan to downsize or move in the future.

Can you remortgage?

Yes, it’s possible to remortgage if you have a Retirement Interest Only mortgage. If you switch lenders or want to increase your loan, you'll have another full affordability assessment. If you don't pass it, the lender won’t approve your remortgage. Getting help from Saga Mortgages can help you avoid this, as we know which lenders are most likely to approve you.

Can you repay your loan?

It’s possible to repay the mortgage loan early by selling the property. However, some lenders may also let you make capital repayments during the mortgage term.

What happens if you can’t pay?

As with a normal mortgage, your lender will try their best to help you find a way to manage your costs. However, if you still can't afford to repay, the lender may repossess your property. This is always a last resort.

Why choose Saga Mortgages?

Saga Mortgages is a service provided by Tembo, available exclusively to Saga. You’ll benefit from their award-winning advice from a friendly, experienced team of mortgage professionals, who are available 7 days a week.

They’ll search all the available options to find the best option and mortgage rate for you, including specialist products bespoke to Saga Mortgages.

Can you talk to an advisor?

Through the Saga Mortgage service, you can book a session with Tembo's award-winning mortgage advisors. Simply complete our online fact find and, if you’re eligible, you’ll be invited to book a session.

The team is available seven days a week, ready to answer any questions you may have.

What lenders can you access?

With Saga Mortgages, you could access deals from high-street lenders like Nationwide, Halifax, Lloyds, Barclays and HSBC. We also offer access to specialist lenders like Livemore and Generation Home.

Is Saga Mortgages regulated by the FCA?

All mortgage advice through Saga Mortgages is provided by Tembo Money Limited. They are regulated by the Financial Conduct Authority (FCA) under the registration number 952652. Their team of mortgage advisors can provide guidance on remortgaging, family mortgages and later life lending.

What happens if you pass away?

If all the people named on the mortgage have died, the property will be sold, and the funds will be used to settle the loan. The loan could also be repaid using other means by the beneficiaries of the will.

If one person dies, but the other mortgage holder(s) are still alive, they continue to repay the interest if possible. Mortgage affordability is worked out using the lowest earner’s income. This lowers the risk that a surviving mortgage holder can't afford the loan.

If you think you won’t be able to repay, you should contact your lender. Speak to them as soon as possible, ideally before you miss a payment. They will discuss what options are available to you. As a last resort, this could mean selling the home to repay the loan.


Your home may be repossessed if you fail to repay your mortgage. Saga Money may receive payment from Tembo if you get a mortgage offer via the Saga Mortgages service. This will not affect the amount you pay for the service.

Saga is a registered trading name of Saga Personal Finance Limited, which is registered in England and Wales (company number 3023493). Registered office 3 Pancras Square, London, N1C 4AG. Saga Personal Finance Limited is authorised and regulated by the Financial Conduct Authority under the registration number 178922.

Tembo Money Limited (12631312) is a company registered in England and Wales with its registered office at 18 Crucifix Lane, London, SE1 3JW. Tembo is authorised and regulated by the Financial Conduct Authority under the registration number 952652. Tembo Money was awarded Best Mortgage Broker at the British Banking Awards in 2022 and 2023.