Santander to sell L&G equity release mortgages
Santander has announced that it has agreed a five-year deal with Legal and General Home Finance to offer the business’s lifetime mortgages to its own existing customers struggling to pay off their interest-only mortgage.
The bank said it hopes to bring greater certainty to borrowers with endowment policy shortfalls or customers who would prefer to stay in their home rather than downsize in retirement.
A lifetime mortgage from Legal and General would enable borrowers to stay in their existing property and raise funds – either to pay off an interest-only mortgage or to help fund their retirement.
Equity release specialist adviser, Key Retirement, will provide lifetime mortgage advice to Santander’s customers, with no separate advice fee charged whether clients make use of the service or not. No valuation or arrangement fee will be charged to Santander customers that opt for an L&G lifetime mortgage.
Miguel Sard, managing director mortgage division at Santander UK, said: “This new partnership promotes flexibility and choice for existing, interest-only customers who are approaching retirement and want to find a mortgage solution that suits both their lifestyle and their financial position.”
Legal and General entered the retirement lending market last year and have so far sold over £400m of lifetime mortgage deals.
Bernie Hickman, CEO, Legal & General Home Finance, said its tie-up with Santander would boost awareness of the benefits of using lifetime mortgages to improve living standards in retirement.
“Thousands of borrowers need to find a way to pay back the capital on their interest-only mortgage when their term ends and often, if they are retired, they don’t have the income to support the mortgage repayments required to do this,” he added.
“Legal & General is confident that our lifetime mortgages can play a crucial role in tackling what is a UK wide problem, broadening the range of options that are available to interest-only customers as they reach retirement.”