Lifetime mortgages

One of our award-winning Lifetime Mortgages could help you pay off your Co‑operative Bank mortgage balance in full, including any early repayment charges that may apply. Whether you'd like to continue paying the interest each month or not, we could have a solution for you.

Overview

What is a Legal & General Lifetime Mortgage?

  • It's a loan secured against your home that must be used to pay off your existing mortgage balance in full, including any early repayment charges that may apply.
  • If you don’t need the full amount we can lend you, there’ll be more money available to borrow if you wish. You can either take it all at once, or in smaller amounts when you need them. It can be used for things such as home improvements, holidays or to improve your quality of life.
  • If you take smaller amounts later, a different interest rate may apply to each amount you take, depending on the interest rates available at the time.
  • We offer two Lifetime Mortgages:
    Lifetime Mortgages offered by Legal & General
    Flexible Lifetime Mortgage Optional Payment Lifetime Mortgage
    With our Flexible Lifetime Mortgage, you won't have to make any monthly payments. With our Optional Payment Lifetime Mortgage, you can choose to pay some, or all, of the monthly interest by Direct Debit. If you choose this product, it could help you reduce the overall cost of the loan. You can stop making monthly payments at any time.

  • With both our Lifetime Mortgages, any unpaid interest is added each month to the amount you owe and will increase quickly over time. Interest is charged on the loan plus any interest already added. A lifetime mortgage will reduce any inheritance and the equity left in your home.
  • Our Lifetime Mortgages are usually repaid from the sale of your home when the last surviving borrower dies, or moves out of their home and into long-term care. Of course, any money left over would be available to you or your beneficiaries.

Find out more about lifetime mortgages, how they work and what they can be used for.

What are they and how do they work? video

Transcript: What are they and how do they work?

Lifetime mortgages: What are they and how do they work?

You and your home have been on quite a journey

But it’s not over yet. So how can your home help you now?

Well, with a lifetime mortgage that’s secured against your home, you could unlock some of the cash tied up in your property, as either

A larger single amount, or several smaller amounts, that you can apply to take when you need them.

Interest is only owed when you take the money. You won’t make any monthly repayments.

Instead, interest is charged on both the loan and any interest already owed, and added to the total amount that’s secured against your home.

That means the total you owe can grow quickly, reducing the equity in your home and the value of any inheritance you may leave.

The loan and the interest are only repaid when you die or enter long term care.

The money you release could be the savings you never knew you had, helping you in your retirement.

It’s a big decision, and there are many factors to consider. That’s why you can only get a lifetime mortgage through a qualified adviser.

They’ll ensure that you’re eligible for the product, and can check if it’s the best solution for you.

Could I qualify?

If you answer "yes" to all the following questions, a Legal & General Lifetime Mortgage could be right for you.

  1. Are you aged 55 or over?
  2. Is the property your primary residence?
  3. Is your property made of standard construction, in a good state of repair, free of any tenancy restrictions and in England, Wales or mainland Scotland?
  4. Is your home valued at £100,000 or more (£150,000 for ex-council, ex-housing association or ex-Ministry of Defence properties)?
  5. Do you own your property?

What are the benefits and risks?

Benefits and risks
Benefits Risks

Cash when you need it.

You could release money from your home, tax-free. Once you've paid off your existing mortgage balance in full including any early repayment charges that may apply, if you have any remaining money available you can take it all at once or in smaller amounts when you need them. If you take it in smaller amounts, known as the Drawdown Facility, the interest rate for each amount will depend on the interest rates available at the time.

How you spend or use the money may affect the tax you pay and the benefits you receive.

If you take more money later, the interest rate for that loan will be set at that time, and may be higher or lower than the rate you pay on your initial amount.

A lifetime mortgage may affect your entitlement to state benefits.

You still own and can stay living in your home.

You won't need to move out until the last surviving borrower dies, or moves out of your home and into long-term care. This is as long as you meet the Terms and Conditions of the lifetime mortgage.

Failure to meet the Terms and Conditions.

For example letting out, or failing to maintain the property, may mean that we have to put it right on your behalf. It could even result in the forced sale of your property and loss of Inheritance Protection if you have taken it.

Ability to make Optional Partial Repayments.

You can pay part of your lifetime mortgage off early with no Early Repayment Charge, provided it is within the limits and terms that apply. This will reduce the total amount of interest that will accumulate on your lifetime mortgage.

The total amount you owe increases quickly over time.

Unpaid interest is added to the loan. This means the amount you owe will increase quickly over time, reducing the equity left in the home and the value of any inheritance.

You should consider if there are cheaper ways for you to borrow money.

No Negative Equity Guarantee.

This means you or your beneficiaries will never have to pay back more than the amount your property is sold for. This is provided it is sold for the best price reasonably obtainable and you have met the Terms and Conditions of your lifetime mortgage.

You may have to pay a charge for early repayment.

If you decide to repay more than you are allowed under Optional Partial Repayments, or decide to repay all of your lifetime mortgage early, you may have to pay an Early Repayment Charge, which could be substantial.

You can leave an inheritance.

If you take out Inheritance Protection, you can secure a percentage of the net sale proceeds of your home for your beneficiaries. If you require the maximum loan amount to repay your residential mortgage, Inheritance Protection may not be available.

You will need to pay up-front costs when taking out a lifetime mortgage.

Taking into account the up-front costs, if you were to die or move out of your home and into long-term care within a short period, there may be cheaper ways for you to borrow money.

The loan is portable so you can take it with you when you move home.

You can move home and your lifetime mortgage can move with you, providing your new property is acceptable to us and meets our lending requirements at that time.

There may be no inheritance left for your beneficiaries.

Unless you have taken out Inheritance Protection, but remember this reduces the amount you can borrow. If you require the maximum loan amount to repay your residential mortgage, Inheritance Protection may not be available.

No affordability checks.

The amount you can borrow depends on your age, the value and suitability of your home, and whether you are applying jointly or as an individual.

You may need to repay part of your lifetime mortgage if you move.

If, for example, your new property is worth less than the original property. In this case, any amount that we ask you to repay would not be subject to an Early Repayment Charge.

How much could I borrow?

Our easy-to-use calculator will give you a quick idea of how much money you could borrow.

How do I take out a Legal & General Lifetime Mortgage?

You can only take out a Legal & General Lifetime Mortgage through a lifetime mortgage adviser. If you have an adviser, please discuss it with them. Alternatively View - The Co-operative Bank can put you in touch with The Retirement Lending Advisers.

The Retirement Lending Advisers (TRLA) are lifetime mortgage advisers. They’re not part of Legal & General, they’re a separate company who only advise on our Lifetime Mortgages. They won’t charge you an advice fee.

For our customers who were charged an advice fee by an independent financial adviser, the majority paid £1,134 or more. This fee could have been saved if they had used TRLA to advise them on their Legal & General Lifetime Mortgage.

Savings are based on advice fees paid by Legal & General customers in 2017. Independent financial advisers can give advice on all lifetime mortgages available in the market. Advice fees vary and any actual savings will depend on your individual circumstances.

If you prefer to talk to your own financial adviser and you don't have one, you can find a list of advisers in your area on the Link to Equity Release Council's website or Unbiased websites.

Frequently asked questions

Get answers to some of our most common questions.