What is a lifetime mortgage?
A way to release equity from your home.
A lifetime mortgage is a way to borrow against your home. It’s a type of equity release product. A lifetime mortgage is usually repaid from the sale of your home after the last borrower dies, or moves out of your home and into long-term care. To ensure you understand all the features and benefits, you can only get a lifetime mortgage through a specialist adviser.
Why choose Legal & General?
If you already know Legal & General, then we hope you'll know we're a company you can trust and that we're committed to helping you plan and build a secure financial future.
Established in 1836, Legal & General is one of the UK's leading financial service groups and a major global investor, with international business in the US, Europe Middle East and Asia.
We lent £965 million in 2019, making us one of the largest lifetime mortgage lenders in the UK. Since 2015 we’ve helped over 84,000 customers get a lifetime mortgage and start living a more colourful retirement.
We're always looking for new ways to help people lead a better retirement. We create products that work and that actually meet your needs as they change during your retirement.
We take your security and happiness very seriously: we only offer our Lifetime Mortgages through fully qualified and approved financial advisers.
That's why we believe Legal & General is a natural choice, particularly if you want to repay your Co-Operative interest-only mortgage with one of our Lifetime Mortgages. If you choose to do this, you must use the lifetime mortgage to pay off your existing mortgage balance in full, including any Early Repayment Charges that may apply.
You should consider if there are cheaper ways for you to borrow money.
What is equity release?
Equity release is a product that lets homeowners aged 55 and over, take some of the money built up in their home, as tax-free cash. There are two types of equity release, lifetime mortgages and home reversion plans. Legal & General only offer lifetime mortgages.
How do lifetime mortgages work?
A lifetime mortgage lets you borrow tax-free cash against the money that's tied up in your home (equity).The interest rate is fixed for the duration of the lifetime mortgage. And depending on which product you take out, you can choose to pay none, some or all of the interest, subject to our terms and conditions. Interest is charged on the loan, plus any interest already added, this means the amount you owe can increase quickly over time.
A lifetime mortgage is usually repaid from the sale of your home after the last borrower dies, or moves out of your home and into long-term care.
Why is professional advise so important?
You can only get a lifetime mortgage through a specialist adviser. Lifetime mortgage advisers are experts who have passed detailed, professional exams, meaning they can look at your situation and work out if it's right for you.
They'll also help you compare different options, complete an application, and because you will need independent legal advice, help you find a solicitor too.
You can contact us and a Legal & General financial adviser will help you decide if this is the right option for you. They can only advise you on our Lifetime Mortgages and they won't charge you an advice fee. If we don’t have the right product for you, we will refer you to another advice firm, who has access to the whole lifetime mortgage market.
Find out more about what to expect from an adviser in our animation.
How long does it take to get the money?
It usually takes about eight weeks from the time your adviser completes your application to the time you’ll receive your money. Of course, this will vary from case to case, depending on the property, for example.
Will a lifetime mortgage affect any inheritance?
Yes. You can access your home’s equity now, but the value of any inheritance you leave will be reduced. We offer optional Inheritance Protection, which lets you protect a proportions of the net sales proceeds for your loved ones. If you choose to do this it will reduce the amount you can borrow.
|If your property is currently worth £200,000 and you want to protect 30% of the net sale proceeds from your home, then the maximum amount we would lend will be calculated on 70% of the property value: £140,000 instead of £200,000.|
Of course, even if you don’t select Inheritance Protection, any money left over after repayment of your lifetime mortgage will be paid to you or your estate.
Inheritance Protection cannot be added to the lifetime mortgage or the amount increased after completion of your lifetime mortgage.
Can I get a lifetime mortgage if I already have a mortgage?
You may still qualify for a lifetime mortgage but you'll need to pay off your existing mortgage and any other loan secured against your property using money from the loan. If you pay off your existing mortgage you may have to pay an Early Repayment Charge to your existing lender.
You should think carefully before securing a new debt against your home.
Can I get a lifetime mortgage if there’s someone else living with me in the home?
Yes, but if it’s someone living there permanently then it would be a good idea for them to take legal advice. We may ask them to sign a form acknowledging that they know there is a lifetime mortgage on the property.
Will my state benefits be affected?
Your entitlement to means-tested benefits could be affected by a lifetime mortgage.
Everyone’s situation is different, which is why we encourage you to look at other options as well.
Your adviser can help you understand how any benefits you’re receiving may be affected.
Will a lifetime mortgage affect my tax position?
The money you receive will be paid free of tax. Depending on what you do with the money, tax may become payable. Please talk to your adviser to find out how it may affect your tax position.
If my partner and I separated or divorced and we had a joint lifetime mortgage, what would happen?
You would need to take legal advice from a qualified professional; the options would vary depending on your circumstances.
Some options could include selling the house, repaying the loan, and dividing the remainder between you; you could decide who’ll be the owner and we could remove the other person from the title deeds; or, if a court is involved, any equity left after the property has been sold and our loan repaid, would be distributed as directed by the court.
How do you pay back a lifetime mortgage?
Our Lifetime Mortgage is designed to last for your lifetime and to be repaid when you (or, if borrowing jointly, both of you) die or move out of your home into long term care. However, we understand your circumstances may change and you may wish to repay your lifetime mortgage early, in which case an Early Repayment Charge may be payable. Which could be substantial.
With a Legal & General Lifetime Mortgage, will I still own my home?
Yes. With our Lifetime Mortgages, the property stays in your name and the loan is secured against your home. Unless you choose to repay it early, a lifetime mortgage is only repaid when your property is sold. This usually happens when the last surviving borrower dies, or moves out of the home and into long-term care.
If you decide you want to repay the loan early, outside the terms of our Optional Partial Repayment feature, you may need to pay an Early Repayment Charge which could be substantial.
What if I have money available and want to repay part of my lifetime mortgage?
Our Optional Partial Repayment feature allows you to reduce the amount you owe by making partial repayments without paying any Early Repayment Charge.
In any 12 month period starting on the completion of your lifetime mortgage and thereafter on each anniversary of the completion, you can repay up to 10% of the total amount(s) you have borrowed, which includes the cash lump sum, plus any additional borrowing you have received, for example a drawdown.
You can make up to four Optional Partial Repayments in any 12 month period starting on the completion of your lifetime mortgage and thereafter on each anniversary of the completion, subject to a minimum of £500 each.
With a Legal & General Lifetime Mortgage, can I move home?
Yes, as long as the new property meets our lending criteria and there’s enough equity in the property after it’s sold. You must tell us in advance if you wish to move and we’ll need to give our consent.
Your new property will be valued by a valuer that we’ll choose — and you’ll have to pay the valuation fee, the property transfer fee, all legal fees and any moving expenses. Depending on the situation, you may have to repay part of the loan if it exceeds the amount we would agree to lend to a new customer in comparable circumstances. There would be no early repayment charges on that amount.
With a Legal & General Lifetime Mortgage, in the future could you make me leave my home?
With all of our Lifetime Mortgages you (or both of you if borrowing jointly) stay in your home until you die or move out of the home into long-term care, as long as you comply with the product terms and conditions which your adviser will explain to you.
Failure to comply with these could result in the forced sale of your property and the loss of the right to Inheritance Protection, if this has been chosen.
What happens if the property market falls in value and I have a lifetime mortgage?
All of our Lifetime Mortgages come with a No Negative Equity Guarantee. It means that even if your home goes down in value, you or your beneficiaries will never have to pay back more than the amount your property is sold for, provided it is sold for the best price reasonably obtainable.Your financial adviser will explain the terms and conditions of this.
I have a Legal & General Lifetime Mortgage. How can I make a complaint?
We know that sometimes things can go wrong. Our number one priority is to provide you with the highest level of customer service. If there’s a problem please let us know and we’ll try to provide a solution as quickly as possible.
If we can't resolve your complaints straightaway we'll tell you who will be be dealing with it and what the next steps are.
After looking into your complaint we will respond as quickly as possible and keep in touch with you until your complaint has been resolved. If you disagree with our decision, feel we have misunderstood anything or you have any extra information please let us know.
You can contact us in the usual way, including by phone, letter or email. Relevant information (customer reference and/or account number) should be in letters and documents you’ve received.
Letter: Customer Outcomes Manager, Legal & General Home Finance, Chadwick House, 737 Blenheim Court, Solihull, B91 2AA.
Phone: 03330 048444. Lines are open 8.30am to 5.30pm, Monday to Friday. Call charges will vary. We may record and monitor calls.
Please include your phone number, so we can call you about your email Monday to Friday between 9am and 5pm. When sending emails you should not include any personal, financial or banking details, as this method is not a secure way of supplying information.
The Financial Ombudsman Service
If we haven’t issued our ‘final response’ within eight weeks from the date you first raised your complaint, or if you’re dissatisfied with our response, you can ask the Financial Ombudsman Service for an independent review. The Financial Ombudsman Service may only consider your complaint once you’ve tried to resolve it with us, so please take up your concerns with us first and we’ll do all we can to help.
Letter: The Financial Ombudsman Service, Exchange Tower, London, E14 9SR
Phone: 0800 023 4567 or 0300 123 9123 or if calling from outside the UK +44 20 7964 0500