What is an Optional Payment Lifetime Mortgage?

Tax-free cash, with optional payments

Our Optional Payment Lifetime Mortgage, a type of equity release, is a loan secured on your home which allows you to borrow against the value of your home while continuing to live there. You get a tax-free cash sum, and could reduce cost by making monthly interest payments. You can stop interest payments at any time, but you won’t be able to restart them.

This could be one solution if you‘re approaching the end of an interest-only mortgage and need to repay it. You may need to pay an early repayment charge to your lender.

  • Tax-free cash

    Since the money you release, with a lifetime mortgage is borrowed from your equity, it remains tax-free.

  • Option to make monthly payments

    You can pay some or all of the monthly interest to reduce the overall cost of the loan, and you can stop making payments at any time.

  • Release equity when you need it.

    There’s flexibility to borrow more in the future if you choose not to take the full amount available upfront. If you take smaller amounts later, a different interest rate may apply to each amount to take, depending on interest rates available at the time.

  • Guaranteed no negative equity

    We guarantee that your beneficiaries will never have to pay more than the sale value of your home. This is as long as the property is sold for the best price reasonably obtainable and you’ve met the product Terms and Conditions

Find out more about how equity release works

  • Am I eligible?

    You must be 55 or over and living in (or buying) your own home, with either a small or no mortgage. Your home will need to be worth a minimum of £70,000 or £100,000 for flats, maisonettes, ex-council, ex-housing association or ex-Ministry of Defence properties.

  • I have an Interest Only Mortgage

    If you have an existing interest-only mortgage that’s coming to an end and you can still make Monthly Interest Payments, then an Optional Payment Lifetime Mortgage or Retirement Interest Only mortgage could be for you. With our Optional Payment Lifetime Mortgage you can choose to pay all or some of the monthly interest for the rest of your life, or until you decide to stop (any unpaid interest is added to the amount you owe).

  • I want to take lump sums

    Optional Payment Lifetime Mortgage lets you take a one off lump sum, or smaller amounts as and when you need them. You can borrow a minimum of £10,000 in your first release and then future lump sums of at least £1,000 each time.

  • I want some flexibility later

    If you want the option to release more equity in the future, then an adviser can help you achieve this with a lifetime mortgage. If you take smaller amounts later, a different interest rate may apply to each amount to take, depending on interest rates available at the time.

Find out more in our Lifetime Mortgage guide

  • Impact on inheritance

    A lifetime mortgage will reduce any inheritance you wish to leave. When you apply for a lifetime mortgage, there's an option to take inheritance protection to secure a proportion of the net sale proceeds of your home.

  • Early Repayment Charges

    As a lifetime mortgage is designed to last a lifetime. If you decide to repay your lifetime mortgage in full, you may have to pay an Early Repayment Charge which could be substantial, so think carefully before you decide.

  • Moving home

    You can move home, and the loan will be transferred as long as the new property meets our requirements.

  • Means tested benefits

    Taking out a lifetime mortgage may affect your entitlement to means-tested benefits or pension credit.

  • Compound interest

    Interest is charged on the loan, plus any interest already added. So, if you don’t pay some or all of the monthly interest, the amount you owe will increase quickly over time. There may be cheaper ways to borrow money.

The pros and cons of equity release

Equity release calculator

This calculator helps you see how much equity you could release with a lifetime mortgage, a loan secured against your home. We’ll ask you to register your details so we can show you the calculation. You may also receive a call from us to assist you with your enquiry.

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This is a guide to the lifetime mortgage products we offer, and not advice or a personal recommendation. You can only buy a lifetime mortgage through a financial adviser.

If we call, we’ll use your address to look up your property to assist with your enquiry.

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Get in touch about our lifetime mortgages

To speak to us about a lifetime mortgage, call our advice team on the number below.

For any other enquiries please get in touch via our contact us page

0808 301 7044

Monday to Friday 9:00am - 5:30pm
We may record and monitor calls.

Need help?

Making decisions about how to finance your retirement is important so it’s worth shopping around and using available guidance and advice, before you buy.

Retirement guidance

Equity Release Council

Legal & General Home Finance Ltd is a member of the Equity Release Council, a trade body setting standards for providers.

Take a look at their consumer brochure for more details

Contact us about equity release

Call us on:

0808 301 70440808 301 7044

Monday to Friday 9:00am - 5:30pm,
We may record and monitor calls.

For any other enquiries please get in touch via our contact us page.


Get independent advice

You can't take out an equity release product unless you have taken financial advice.

Find out how to access independent legal and financial advice.