Newlife is a privately owned UK-based provider of lifetime mortgage products. The acquisition by Legal & General’s Retirement division is expected to complete during H1 2015, subject to FCA approval.
Newlife was founded in 2003 to manufacture and provide lifetime mortgages, designed to assist homeowners to raise cash against the security of their property while continuing to own and live in their homes.
Legal & General has also today entered into a funding agreement to be the sole funder of new lifetime mortgages originated by Newlife. This mortgage funding will provide another attractive source of direct investment assets to back Legal & General annuity liabilities.
Peter Lucas, Executive Director and Co-founder, Newlife Group, said:
“We are looking forward to being part of Legal & General and to continue to build on the successful base we’ve established in the lifetime mortgage market. With Legal & General’s reputation as a highly regarded customer focused brand and access to their distribution networks, we will be able to help meet the needs of more customers and so become a leader in this growing market.”
Bernie Hickman, Managing Director of Legal & General’s Individual Retirement business, said:
“We are delighted to announce our acquisition of Newlife and our entry into the lifetime mortgage market. Over 60s in the UK have nearly £1.3 trillion in housing equity and we believe lifetime mortgages will become an increasingly popular way for many people to supplement their retirement income.
Legal & General’s acquisition of Newlife allows us to participate fully in this market, which we believe has huge potential. With close to £40bn of annuity assets, we have considerable capacity to provide future funding in this growing market.”
Nigel Waterson, Chairman of the Equity Release Council, added:
“We look forward to welcoming Legal & General to the equity release market following its acquisition of Newlife, which is itself a valued and longstanding provider member of The Council. It is no secret that some major high street names have been considering a move into equity release, which will give the sector an additional boost following a record £1.4bn of lending activity last year.
“There is great potential for equity release to help ever more people to find financial comfort in retirement. Legal & General’s recent report on the UK housing crisis called for more big lenders and institutions to join the market, and its decision to take the initiative is another significant milestone in the growth of equity release. We anticipate that Legal & General will provide valuable support alongside our existing members to build the profile of equity release, as well as extending consumer choice and protection.”
