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Lifetime mortgages are no longer the last resort – Ellis

by: Steve Ellis, chief executive officer of Legal & General Home Finance
  • 19/03/2018
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Lifetime mortgages are no longer the last resort – Ellis
Over recent years there has been a real sea change in attitudes towards lifetime mortgages and the idea of making use of property wealth in retirement.


While once considered a product of last resort, today they are viewed much more positively.

Lifetime mortgages are a product whose time has come. Indeed, in recent years, the lifetime mortgage proposition has been called progressive and innovative. Importantly they are now considered as a true solution to releasing equity and providing a real benefit.

As we predicted, this is a solution that is now making later life better for thousands of Britain’s over-55s, helping them to achieve the things they want in retirement.

Importantly, grandparents, and parents who are keen to help younger family members onto the property ladder are turning to lifetime mortgages to assist family members in a way that allows them to appreciate what they have helped with while they are still alive.


Full circle

The recent silver spenders report we published indicated that 15% of those who released equity did so with the aim of helping a family member with a deposit for a property. The money truly is going full circle, from one property to another – from one family member to another, from one generation to another. The released equity is being used to help children and grandchildren buy homes of their own.

For retirees, releasing the money tied up in their property can be put to whatever use they see fit. While 15% of those are using the equity to help family and friends, it is also a way to help realise the homeowners’ own home improvements.

The silver spenders report found that 36% of homeowners would use their pot to renovate and refurbish their property, 17% of respondents admitted that they would use the money to head off on holiday, and 13% would even use the money to treat themselves to a new set of wheels – a new car or motorbike.



This trickledown effect of cash being unlocked from housing equity means that lifetime mortgages are beginning to have a positive measurable impact on the UK economy.

As well as benefitting individuals and families, the silver spenders report highlighted the economic benefits of releasing equity in property. Lifetime mortgages are good for the economy with the statistics indicating that the value of releasing equity adds over £7bn to gross UK output. The impact on the country’s gross value added meanwhile, is a substantial £2.4bn a year.

These are staggering numbers and the effect of these means that growth should be seen in both employment figures and in wages. And, with more money in their pocket, employees are in a position to spend more, too.



It is clear that much needs to be done to help the affordability, accessibility and availability of property, especially for the younger generations. More people are turning to their parents and grandparents for financial support to step onto the property ladder.

The 15% of those releasing equity to help family members on the property ladder is only likely to grow as property strains remain – and increase.  As our report shows – equity release is clearly a huge factor in the Bank of Mum and Dad.

It is essential that homeowners examine all of their options before they jump into releasing equity in their property. But for some people accessing the wealth in their home could really help – whether it be to make changes to their property, help family members get on the property ladder or head off on that once-in-a-lifetime-holiday.

I am confident that our silver spenders campaign will show that the lifetime mortgage market is now playing a positive role in the finances of Britain’s retirees and of our wider economy – and as the market expands, so too will the beneficial impact of unlocking equity.

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