Legal & General has signed a 5-year partnership with The Co-operative Bank to offer lifetime mortgages to its interest-only customers aged 55 and over who are approaching retirement.
The offer will be made available both to those who are having trouble paying off their outstanding capital and those who want to have a better lifestyle after retiring by releasing equity from their home.
Legal & General already has a similar agreement in place with Santander, which was signed in July 2016.
Steve Ellis (pictured), managing director of Legal & General Home Finance, said: “Accessing property wealth for later life is a concept that is rapidly growing in popularity amongst Britain’s over-55s as the latest report from the Equity Release Council demonstrates.
“This latest partnership reiterates just one of the ways we wish to meet the rising demand from consumers for lifetime mortgages.
“There are still a significant number of borrowers who have not set aside the necessary funds to repay the outstanding capital once their interest-only mortgage matures, and a lifetime mortgage could be one solution for these individuals.
“With two of these partnerships now under our belt, Legal & General Home Finance will continue to explore the possibility of more agreements of this type, to help these borrowers to manage their interest-only mortgage and get the most out of later life.”
The Co-operative Bank’s customers will be offered advice on L&G products by The Retirement Lending Advisers, part of Key Retirement Solutions.
The equity release market has transacted £2.22bn of business in the first three quarters of 2017, up from £2.15bn in the corresponding period of 2016.
Matthew Carter, director of products and communications at The Co-operative Bank UK said: “This new agreement is the next step in The Co-operative Bank’s developments in providing an alternative and sustainable option for our interest–only, end-of-term customers who are approaching or who are in retirement.
“We look forward to working with Legal & General Home Finance to help more of our customers create a better, more secure, retirement, through increasingly effective ways of managing their finances in later life.