17 April 2018

Our Optional Payment Lifetime Mortgage

At Legal & General, we’re committed to helping people utilise the equity in their homes to achieve financial security in retirement. 

Many of our customers are already benefiting from our current Lifetime Mortgage product which is a loan secured against your client's home. This enables them to use equity in their home to receive a sum of cash, perhaps to pay off an existing mortgage and help achieve financial security in retirement. The loan plus interest is repaid from the sale of the home when the last remaining borrower dies or moves out of the home and into long-term care. This means that customers who have little income and are unable to make payments are still able to borrow.

But what about customers who can afford to pay an amount each month? 

About the new product

Our new ‘Optional Payment Lifetime Mortgage (OPLM) product' will enable customers who take out a Lifetime Mortgage with us, to pay some or all of the monthly interest by Direct Debit to help reduce the total amount of the loan. This is just the first in a range of product innovation coming from us this year.


  • Repaying a residential mortgage – Customers can release money from their home and use it to repay their existing residential mortgage, including an interest-only mortgage that is due for repayment.
  • They can choose to pay some, or all, of the monthly interest and stop making monthly interest payments at any time – making monthly interest payments will reduce the amount of interest that will accumulate over the term of their lifetime mortgage.
  • Optional Payment Lifetime Mortgages come with all of the features and benefits that our current Lifetime Mortgage product provides. This includes the ‘right of tenure’ which means that we will never force a customer from their home or force them to sell it either, even if they do decide to stop making payments in the future.  

Target Audience

The new product will predominantly help interest-only mortgage customers, aged 55 and over, who:
  • have some income and wish to continue with their lifelong routine of making monthly interest payments; 
  • who do not qualify for a residential mortgage or who are unable to continue with their interest-only mortgage once it has matured;
  • who would like the certainty of fixed monthly payments (rather than be exposed to changes in interest rates);
  • require the guarantee that should they, at any time, not be able to afford the monthly interest payments that they can convert to our standard lifetime mortgage product and remain in their home;
  • understand any unpaid interest is added to the amount they owe and will increase quickly overtime. Which means that interest is charged on the loan amount plus any interest already added.

Find out more by clicking below.

View - Optional Payment Lifetime Mortgage                                       

Steve Ellis

Article written by:

Steve Ellis

CEO of Legal & General Home Finance

“This product is another example of where we’re keeping our promise to innovate in the market and give consumers the choice and control over their retirement."