Legal & General has signed a five-year deal to supply lifetime mortgages to Santander customers.
An L&G statement says the arrangement could help Santander interest-only mortgage customers who struggle to repay capital at the end of their terms.
The deal will also be open to Santander mortgage customers that want to release equity in retirement.
No separate advice, valuation or arrangement fees will be charged.
Santander UK mortgage division managing director Miguel Sard says: “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 & General Home Finance chief executive Bernie Hickman says: “This is a really positive move for the retirement lending market that will see more customers realising the benefits of releasing equity to make their retirement better.
“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.
“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.”
Advice will be given by lifetime mortgage advisers Key Retirement.
Key Retirement chief executive Colin Taylor says: “Key Retirement are delighted to be working alongside Legal & General in providing equity release solutions for Santander customers with maturing interest only mortgages.”