Fall in lifetime mortgage customers using property wealth to pay off debts
New trends reveal shift in how customers are using equity release, with debt repayments in decline.
New data from L&G’s Home Finance business1 has revealed a shift in how homeowners are using equity release, with far fewer turning to it to pay off debts.
The proportion of new customers turning to their property wealth to repay an existing mortgage has dropped from 31% to 19% of applications between H1 2024 and H1 2025. Similarly, the number using it to clear other debts, such as loans or credit cards, has also fallen (25% to 23%).
Instead, equity release is being used to support quality-of-life spending and family priorities. Half (50%) of customers are using it to fund home improvements, while one in five customers (18%) are using their property wealth to support other family members in the form of a financial gift.
Mike Batty, Product & Proposition Director, Home Finance, L&G: “Property wealth continues to be a useful tool for homeowners looking to fund later life and help achieve longer term goals. It’s encouraging to see people turning to the money tied up in bricks and mortar to improve their quality of life.
“As a lender, we continue to work with advisers and the wider industry to ensure the best outcomes for people looking to benefit from accessing their property wealth. While not suitable for everyone, lifetime mortgage solutions can be an important consideration as part of a holistic approach to financial planning.”
References:
1Legal & General Home Finance data analysing loans across 2024 and 2025
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Notes to editors
Established in 1836, L&G 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 FY25) of which c. 43% (c. £0.5 trillion) is international. We have a highly synergistic business model, which continues to drive strong returns. We are a leading player in Institutional Retirement, in Retail Savings and Protection, and in Asset Management through both public and private markets. Across the Group, we are committed to responsible investing and dedicated to serving the long-term savings and investment needs of customers and society.
L&G’s Retail business is a leading provider of retirement and protection solutions. We aim to support our 12.4 million customers throughout their financial lifetimes.
We focus on helping the customers of today and tomorrow achieve better long-term outcomes. We use the latest technology to connect with them quickly, efficiently and wherever possible in highly personalised ways.
As at the first half of 2025, our workplace pension platform served 5.6 million members, with net flows of £4 billion. Retail annuity sales were £745 million and lifetime mortgage advances (including retirement interest only mortgages) were £104 million. Our retail protection gross premium income was £771 million.