"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"
Customers with interest-only mortgages will be introduced to Legal & General’s advised lifetime mortgage products. The lifetime mortgages will be offered as another option to help borrowers who are facing difficulty paying off the outstanding capital from their interest-only mortgage or keeping up with mortgage repayments in retirement, as well as for general equity release customers.
The Co-operative Bank’s customers will be offered advice by The Retirement Lending Advisers, who are part of Key Retirement Solutions. If the products Legal & General offer are not suitable, the customer will instead be referred to Key Retirement Solutions’ whole of market service.
Legal & General entered the lifetime mortgage market in 2015 and has since become the largest lender in the sector.
Steve Ellis, Managing Director at Legal & General Home Finance, said: “I am delighted to announce this new partnership with The Co-operative Bank, which follows last year’s pioneering agreement with Santander. We were incredibly proud to be the first lender to secure an agreement of this type, but we always intended to launch further partnerships like this to enable more people to benefit from the positive impact releasing equity can have on retirement.
“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.”
Matthew Carter, Director of Products and Communications at The Co-operative Bank UK, commented: 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.”
Will Hale, Chief Executive of Key Retirement, added: “Over the last 12 months we have seen a significant increase in customers approaching us to look at solutions for re-paying maturing interest-only mortgages and we expect this trend to continue. It’s encouraging to see major lenders such as The Co-operative Bank recognise the importance of specialist advice in this area and be proactive in helping their customers explore the options available to them.
“As the acknowledged market leading adviser with over 19 years’ experience specialising in this sector we are passionate about delivering consistently good outcomes for customers. Through providing this service we look forward to helping even more people to remain in their homes and to enjoy a retirement free of the pressures of ongoing mortgage repayments.”
