Press releases

Legal & General Home Finance launches new lifetime mortgage that pays monthly income

Legal & General has today announced the launch of a new lifetime mortgage that gives customers more flexibility in how they use their housing wealth in later life.

21 Nov 2018

Legal & General media centre

  • Legal & General Home Finance has announced the launch of a new lifetime mortgage that pays customers a fixed monthly income
  • The new product is aimed at customers who want to supplement their income to help them maintain their standard of living and enjoy their retirement
  • The option is another step by Legal & General Home Finance to give customers more flexibility in how they access their property wealth in later life

Legal & General’s Income Lifetime Mortgage provides customers with a regular monthly income over a fixed term to help them maintain the lifestyle they want in retirement.

The new product aims to provide a lifetime mortgage solution for consumers who prefer a fixed monthly income to a lump sum or who haven’t been able to save as much into their pension as they would have liked, or their pension may not have lasted as long as they hoped. It’s therefore a compelling option for those wanting to bridge a retirement income gap, so that they can enjoy a more comfortable standard of living in later life.  

Like Legal & General’s Flexible Lifetime Mortgage range, interest on the mortgage will roll up over the life of the loan. The loan and interest will be repaid from the sale of their property upon the last surviving borrower’s death or a move into long-term care. However, with an Income Lifetime Mortgage the effect of compound interest is reduced as funds are released in monthly amounts, rather than lump sums.  

The product will be available to people aged 55 and over with a minimum property value of £100,000. Customers will be offered an interest rate that is fixed for life at the outset, while the monthly income from the mortgage will run for an agreed term of 10,15, 20 or 25 years and cannot be extended. At the end of the fixed term, the monthly income will stop and interest will continue to roll up until the mortgage is repaid. Consumers can choose to stop this income at any point, but once stopped the income cannot be restarted.

As with Legal & General’s other lifetime mortgages, customers will need to speak with an adviser who can help them to determine whether the Income Lifetime Mortgage is the right solution for their retirement plans. Customers will need to consider the option carefully, as it could affect their entitlement to means tested benefits.

A lifetime mortgage is a loan secured against the client’s home.  The amount that can be borrowed depends on a client’s age, the value and suitability of their home and whether they are applying jointly or as an individual. Dependent on the type of lifetime mortage chosen, the client receives a cash lump sum, smaller amounts as and when required, or a regular monthly income. Interest is added to the amount they owe each month, which means we charge interest on the loan plus any interest already added. The lifetime mortgage is usually repaid from the sale of the property when the client(s) dies or leaves the property for long term care. There may be cheaper ways to borrow money.

Steve Ellis, CEO of Legal & General Home Finance said: “Listening to the needs of Britain’s retirees and finding new ways to help them enjoy the retirement they want is central to everything we do at Legal & General. From offering consumers a lifetime mortgage that allows them to make interest repayments to providing solutions for interest-only mortgage holders, we’ve always sought to deliver on the needs of Britain’s over-55s. Now, our research shows there is a segment of older homeowners who want to use their housing equity in later life, but who also want the discipline of a regular income.

“Whether it’s paying for a day out with the grandchildren or a weekend away in the country, we know how useful that little bit of extra income could be for so many people to keep them doing the things they love. Our income solution is a new option for these consumers, giving them the chance to enjoy the benefits of their housing wealth with a fixed interest rate for life, but with the security of a regular monthly income for up to 25 years.

“There is a bright future ahead for retirement lending and we want to see more people benefit from the positive role their homes can play in later life. More choice and more flexibility in how consumers access and use their housing wealth are key to that future and to leading more people into a better retirement.”

Further information


Margrit Williams

Director of External Engagement

Legal & General Capital

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Nick Seymour

Rostrum Agency

T: 020 7440 8670

Email Nick Seymour

Notes to editors

Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with £1.2 trillion in total assets under management (as at FY23) of which c40% (circa £0.5 trillion) is international.

We have a highly synergistic business model, which continues to drive strong returns. We are a leading international player in Institutional Retirement, in Retail Savings and Protection, and in both public and private markets through our Asset Management division. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.

As at 7 June 2024, we estimate the Group’s Solvency II coverage ratio to be 224%.

As at 11 June 2024, Legal & General has a market capitalisation of £14.6 billion.