Legal and General Equity Release & Lifetime Mortgage Review in 2024

Are You Considering Legal and General Equity Release to Fund Your Retirement? Discover the Pros, Cons, Fees, Interest Rates and Scheme Features. Read This Article to Obtain the Answers You Need…
  • Last Updated: 01 Feb 2024
  • Fact Checked
  • Our team recently fact checked this article for accuracy. However, things do change, so please do your own research.

Contributors:

Francis Hui

Key Takeaways

  • Legal and General equity release is a financial service offered to homeowners over the age of 55 that allows them to unlock capital tied up in their property without needing to move out.
  • This equity release scheme works by providing a loan against the value of your home which will be repaid from the sale proceeds when you pass away or move into long-term care.
  • Possible risks include a reduced inheritance for your beneficiaries, potential impact on your state benefit entitlement, and the possibility of negative equity if house prices fall.
  • To apply, you can visit their website, complete the online application form, and consult with a financial adviser to understand its implications.
  • For reviews, trustworthy sites like Trustpilot or Feefo provide customer feedback and ratings to help make an informed decision.

From insurance and investment management to retirement solutions and equity release, Legal & General offers a comprehensive suite of offerings to cater to various financial needs.

In this discussion, we delve into the details of Legal & General's equity release schemes, examining their features, advantages, and considerations. 

Additionally, we will touch upon the company's approach to customer service, complaints handling, and regulatory adherence, providing a comprehensive overview of it's equity release services.

In This Article, You Will Discover:

    Our experts at Every Investor have examined all offerings to understand the broader context of its services better. 

    NOTEEvery Investor is an impartial and unconnected third-party information provider via this website, and the details replicated in this commentary represent the opinions of Every Investor only and may not reflect the views or opinions of Legal & General. This article must not be interpreted as advice, nor is it a solicitation to conduct transactions in any financial product provided by Legal & General.

    Who Is Legal & General (L&G)?

    L&G is a prominent British financial services company that specialises in insurance, investment management, and retirement solutions. 

    It offers various products and services, including life insurance, asset management, annuities, and pension schemes. 

    The company is known for it's significant presence in the UK and it's status as a major player in the insurance and investment sectors.

    What Is Equity Release Finance?

    For individuals over 55, equity release finance is a way to access the wealth tied up in their homes, providing cash without selling.

    It's a strategic financial move to capitalize on your property's value.

    Its repayment mechanism is distinctive; the loan and interest are repaid only when the property is sold, usually after the homeowner's death or entry into care facilities, offering a deferred payment solution.

    What Is the Process for Applying for Legal and General Equity Release?

    The application process for Legal and General's Equity Release starts with a consultation with a financial advisor.

    Here, they comprehensively assess your financial situation and explain how equity release could impact your future.

    It's during this discussion that all pertinent details related to equity release are discussed, including its impact on inheritance and tax liabilities.

    At this stage, they'll confirm your eligibility criteria such as being over 55 and owning a property valued at least £70,000.

    Once you decide to proceed, your advisor initiates the application for you.

    In the form, they detail your property value, the amount you wish to release, and your personal financial information.

    Legal and General then evaluates your application and property valuation report.

    If approved, they issue an offer detailing terms and conditions.

    After your solicitor reviews and you accept the offer, Legal and General transfer the funds directly to your account. This entire process typically takes 8 to 12 weeks.

    Why You Should Consider Legal & General

    You should consider an L&G equity release loan for the following reasons:

    • Reputation and Experience: A well-established company with a long history since 1836. It has built a strong reputation for reliability, trustworthiness, and financial stability over the years.
    • Comprehensive Financial Services: It offers a wide range of financial services, allowing you to access multiple financial products and offerings under one roof, simplifying your financial management experience.
    • Insurance Expertise: Legal & General is renowned for it's expertise in the insurance industry. It provides various insurance products, such as life insurance, critical illness coverage, and home insurance. It's insurance offerings are designed to provide financial protection and peace of mind to individuals and families.
    • Investment Management: If your are looking for investment opportunities, Legal & General's asset management services can be beneficial. It has a team of experienced investment professionals who manage funds and offer investment options tailored to different risk profiles and financial goals.
    • Retirement Solutions: Whether you need an annuity or assistance with managing your pension fund, it offers expertise and services to help you make the most of your retirement savings.
    • Strong Customer Support: The company focuses on delivering excellent customer service. It has dedicated support teams that can assist you with queries, claims, and any other financial concerns you may have.

    Remember, when considering any financial service provider, it is essential to evaluate your specific needs, compare offerings from different companies, and seek professional advice where necessary.

    What Services Does Legal & General Offer?

    Legal & General offers financial services to individuals, families, and businesses. 

    Key services provided by L&G include:

    • Insurance
    • Investment management
    • Retirement solutions
    • Mortgage services
    • Workplace benefits
    • Savings and investments

    Does Legal & General Offer Equity Release or Lifetime Mortgages?

    Yes, Legal & General does offer equity release as part of it's financial services. 

    Equity release is a financial product that allows homeowners, typically those who are retired or approaching retirement, to release some of the equity tied up in their property whilst still being able to live in it.

    Legal & General’s Equity Release Schemes

    Legal & General offers two main types of equity release schemes: Flexible Lifetime Mortgage and Optional Payment Lifetime Mortgage.

    Flexible Lifetime Mortgage

    The Flexible Lifetime Mortgage is a type of lifetime mortgage that allows homeowners to access the equity in their property while retaining ownership. 1

    Key features of this scheme include:

    • Loan Amount: Homeowners can borrow a lump sum or have access to a pre-approved reserve amount, which they can draw upon as needed.
    • Repayment Options: Borrowers have flexibility in choosing how they repay the loan. They can either let the interest accumulate to be repaid upon the homeowner's passing or move to long-term care, or they can make voluntary payments to lessen the total interest owed.
    • Interest Rate Options: Expect both fixed and variable interest rate options, allowing homeowners to choose the one that suits their preferences and financial situation.
    • Inheritance Protection: An Inheritance Protection Guarantee allows homeowners to protect a portion of the property's value as an inheritance for their beneficiaries.
    • Equity Release Council Standards: Legal & General's Flexible Lifetime Mortgage adheres to the Equity Release Council's standards, ensuring consumer protection and safeguards. 2

    Optional Payment Lifetime Mortgage

    The Optional Payment Lifetime Mortgage is another equity release scheme provided by Legal & General. 3

    Key features of this scheme include:

    • Repayment Flexibility: Homeowners can make monthly interest payments if they wish, which can help control the amount of interest accumulating over time.
    • Lump Sum Option: In addition to the optional interest payments, homeowners can also choose to release a lump sum of equity from their property.
    • Interest Rate Options: Similar to the Flexible Lifetime Mortgage, Legal & General offers both fixed and variable interest rate options for the Optional Payment Lifetime Mortgage.
    • Equity Release Council Standards: This scheme also adheres to the Equity Release Council's standards, providing consumer protections and safeguards.

    Features of Legal & General’s Equity Release Schemes

    Legal & General's equity release schemes offer several features that can be beneficial for homeowners considering this borrowing option. 

    Some common features:

    • Lump Sum Release: Both schemes allow homeowners to release a lump sum of equity from their property. This can provide immediate access to funds for various purposes, such as home improvements, debt consolidation, or supplementing retirement income.
    • Retention of Property Ownership: With both schemes, homeowners retain property ownership. They have the right to live in the property until they pass away or move into long-term care, as long as they meet the terms and conditions of the scheme.
    • Repayment Flexibility: There is flexibility in repayment options. Homeowners can either defer payments, allowing interest to accumulate until they pass away or enter long-term care, or opt for the Optional Payment Lifetime Mortgage scheme to make voluntary payments and potentially reduce overall interest.
    • Interest Rate Options: The Company offers both fixed and variable interest rate options. Homeowners can choose the interest rate option that best suits their preferences and financial circumstances.
    • Inheritance Protection: Legal & General provides an Inheritance Protection Guarantee as part of its Flexible Lifetime Mortgage. This allows homeowners to protect a portion of their property's value as an inheritance for their beneficiaries, ensuring that a specified percentage of the property value will pass to the heirs.
    • Equity Release Council Standards: Both schemes adhere to the standards set by the Equity Release Council. This means products provide certain consumer protections, including the right to remain in the property for life, the option of moving to an alternative property, and the guarantee of no negative equity4, which means the amount owed will never exceed the value of the property.

    Understanding Legal & General’s Equity Release Interest Rates

    Legal & General has both fixed and variable interest rate options for it's equity release schemes. 

    An overview of each:

    Fixed Interest Rate:

    With a fixed interest rate, the interest charged on the equity release loan remains constant throughout the loan term.

    This gives homeowners certainty and allows them to plan their finances accordingly since they know the exact interest rate they will be paying throughout the loan.

    Fixed interest rates can be beneficial in a rising interest rate environment, as they protect borrowers from potential rate hikes.

    Variable Interest Rate:

    With a variable interest rate, the interest charged on the equity release loan can fluctuate over time.

    The variable rate is typically linked to an external reference, such as the Bank of England's base rate5 or the London Interbank Offered Rate (LIBOR),6 plus a fixed margin determined by the company.

    Changes in the reference rate or the fixed margin can cause the interest rate to go up or down.

    Variable interest rates offer the potential for lower rates initially, but there is the risk of rates increasing in the future.

    Note:

    The Equity Release Council's standards dictate that if the rate is variable, it must be capped for the entire duration of the loan.7

    What Are Legal & General Fees?

    Fees for equity release schemes typically include arrangement fees and solicitor fees. 

    However, it is important to note that specific fees may vary based on the type of equity release product, individual circumstances, and prevailing market conditions. 

    An overview of the typical fees associated with Legal & General's equity release schemes:

    Arrangement Fees

    ​​Legal & General may charge an arrangement fee for setting up an equity release scheme. 

    This fee covers the administrative costs and processing of the application. 

    The exact amount of the arrangement fee can vary, and it is typically payable upon completion of the equity release plan.

    Solicitor Fees

    When considering equity release, homeowners are required to seek independent legal advice. 

    Solicitor fees are associated with the legal process of the equity release transaction. 

    These fees cover the services the solicitor provides, such as reviewing the legal documentation, conducting property searches, and ensuring all legal requirements are met. 

    The solicitor fees are paid directly to the solicitor and can vary depending on the complexity of the case and the solicitor's rates.

    Interest Rates

    Interest rates are a crucial component of equity release schemes, as they determine the amount of interest charged on the borrowed funds. 

    The interest rates can be either fixed or variable, as discussed earlier. 

    The specific interest rates will depend on various factors, such as the loan amount, the chosen equity release scheme, the borrower's age, and the prevailing market conditions at the time of the application.

    Does Legal & General Have An Equity Release Calculator?

    Yes, Legal & General provides an equity release calculator on it's website to help individuals estimate how much they may be able to release from their property through an equity release scheme. 8

    The equity release calculator considers factors such as the individual's age, property value, and any outstanding mortgage or secured loans on the property.

    By inputting the necessary details into the calculator, users can obtain an estimated figure of the potential equity release amount available to them.

    It is important to note that the figures provided by the calculator are indicative and may not reflect the final offer or terms provided.

    What Are The Advantages and Disadvantages of Legal & General

    Legal & General has various advantages and disadvantages.

    It is important to conduct thorough research, seek professional advice, and compare different financial service providers to evaluate whether it is the right fit for your specific financial needs and goals.

    Legal & General Pros

    Pros include: 

    • Reputation and Experience: Legal & General is a well-established and reputable financial services company with a long history dating back to 1836. It's experience in the industry can provide reassurance to customers.
    • Comprehensive Range of Services: The company offers a wide range of financial services, including insurance, investment management, retirement solutions, and equity release. 

    This allows customers to access multiple financial products and services from a single provider, simplifying their financial management.

    • Insurance Expertise: It offers various insurance products, including life insurance, critical illness cover, and home insurance. 
    • Investment Management: Legal & General's investment management services cater to both individual and institutional investors. It provides a variety of investment options, such as mutual funds, index funds, and pension funds, managed by experienced professionals.
    • Retirement Solutions: It offers retirement solutions, including annuities and pension schemes, to help individuals plan for their retirement and manage their pension funds.

    Legal & General Cons

    Cons include: 

    • Limited Global Presence: While Legal & General has expanded its operations internationally, its primary market presence is in the UK. This may limit its accessibility and availability of certain products and services in other regions.
    • Pricing and Fees: As with any financial services company, it's pricing and fees may vary across different products and services. It is important for customers to carefully review the fees associated with specific offerings to ensure they align with their financial goals and expectations.
    • Market Dependency: Market conditions and fluctuations can influence the company's performance. Economic factors and market volatility can impact the value of investments and returns.
    • Individual Suitability: Similar to other financial institutions, offerings may not be a fit for everyone. Individuals should consult a professional financial advisor and evaluate their financial status, needs, and risk appetite to decide if available products match their needs.

    How Did We Review the Information on Legal & General?

    We reviewed the information by conducting a thorough analysis of the company, drawing from official publications, regulatory filings, and industry benchmarks. 

    By also incorporating customer reviews and expert opinions, we aimed to present a well-rounded and credible insight into it's offerings, ensuring our evaluation meets industry standards and consumer expectations.

    Legal & General Equity Release Reviews

    Reviews are mixed across various platforms.

    Many people have taken to these review sites to voice their below-standard customer service experiences.

    However, it is good to note that every bad review has been responded to by Legal & General in an attempt to resolve the matter. 

    Ratings from the top review sites:

    • UK Trustpilot Reviews for Legal & General9
    • Customer reviews for Legal & General on Reviews.io10

    Handling Complaints: Legal & General's Approach

    Legal & General has a dedicated approach to handling customer complaints. It strives to provide a fair and efficient resolution process for any customer concerns or issues. 

    Complaints can be lodged by email, letter, or phone.

    For complaints related to equity release, please contact the retirement department using the following contact details:

    • Email: customerservices@landghomefinance.com 
    • Letter: Legal & General Home Finance, PO BOX 17225, Solihull, B91 9US.
    • Phone: 03330 048 444 Option 2, Option 1, 9am to 5pm, Monday to Friday. Phone calls may be monitored and recorded.

    If the complaint is not resolved to the customer's satisfaction, Legal & General provides information on further steps that can be taken. 

    This may involve escalating the complaint to a higher level within the company or seeking external resolution through relevant regulatory bodies or ombudsman services.

    Legal & General's Regulatory Details

    Trading Names

    Legal & General Home Finance Limited

    FCA Permitted Services

    • Banking
    • Insurance
    • Consumer Credit
    • Pensions
    • Investments

    Regulators

    Financial Conduct Authority (FCA)11

    Prudential Regulation Authority (PRA)12

    Registration Numbers

    FCA Ref Number: 303418

    Companies House Number: 04896447

    FCA and Companies House Link

    FCA Link: FCA Link

    Companies House Link: Companies House Link

    How to Contact Legal & General

    You can contact Legal & General by phone, email, or post. 

    It's contact details are as follows: 

    • +44 033 3004 8444
    • enquiries@landghomefinance.com
    • 4th Floor, Chadwick House, Warwick Road, Solihull, West Midlands, B91 2AA.

    Common Questions

    What Is Legal and General Equity Release?

    How Does Legal and General Equity Release Work?

    What Are the Risks of Legal and General Equity Release?

    How Can I Apply for Legal and General Equity Release?

    Are There Any Reviews for Legal and General Equity Release?

    Is Legal and General a Member of the Equity Release Council?

    Who Owns Legal and General?

    How Can I Apply for a Job At Legal and General?

    Is Legal and General's Equity Release Safe?

    In Conclusion

    Legal & General is a reputable and well-established financial services company that offers a range of products and services, including equity release.

    It's equity release schemes are authorised and regulated in the UK by the Financial Conduct Authority and adhere to the standards set by the Equity Release Council. 

    If you are considering equity release, it is vital to evaluate your financial situation, understand the terms, fees, and rates, and consult with a financial advisor. 

    Doing so ensures you make a well-informed decision that aligns with your financial objectives when considering Legal & General's equity release offerings, and deciding if they offer the best equity release plans for you.

    Disclaimer: The features mentioned and the amounts raised, are subject to the lender’s criteria, terms, and conditions. These may take into account age, health, and lifestyle factors in order to provide an enhanced amount.

    The features mentioned and the amounts raised, are subject to the lender’s criteria, terms and conditions. These may take into account the age, health and lifestyle factors in order to provide an enhanced amount. To understand the features and risks, ask for a personalised illustration.

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