"With our first sub-4.5% roll-up lifetime mortgage, we believe we are now offering a product that compares favourably with mainstream SVR mortgages"
Accompanying the rate reduction is a cut to the product arrangement fee, from £4999 to £1999.
For a customer with a loan of £1m over a 15 year period, the new Premier rates would represent a saving to the borrower of £87,594 in rolled-up interest, when compared to the product’s former costings.
The lender has also made reductions on its Flexible and Flexible Plus lifetime mortgage rates, with Flexible falling from 4.99% to 4.59% and Flexible Plus from 5.35% to 4.99%.
Bernie Hickman, Chief Executive Officer, Legal & General Home Finance, said: “The introduction of our market-leading sub-4.5% roll-up product represents a big leap forward in delivering on our commitment to offer better value for money when it comes to retirement lending. Whilst representing big savings for borrowers looking to release equity, these reductions are also blurring the lines with the residential mortgage market, making lifetime a mainstream solution for 55+ financial planning.
“An estimated £1.4trn of housing equity rests in the hands of the over-55s, but for the market to reach its full potential we must continue to improve consumer value for money and encourage more customers to talk positively about the real benefits of releasing equity for retirement.”
Steve Ellis, Chief Operating Officer, Legal & General Home Finance, added: “Even with an expected lifetime mortgage market size of circa £2 billion this year, releasing equity still only makes up a small part of the wider mortgage market. There is so much potential for our market to grow, and it’s therefore clear that more needs to be done to improve consumer confidence. With our first sub-4.5% roll-up lifetime mortgage, we believe we are now offering a product that compares favourably with mainstream SVR mortgages, which will allow customers to make more transparent choices.”
