OneFamily has reduced interest rates and increased the maximum loan amount on its fixed rate lifetime mortgages, in order to widen the appeal of its equity release options.
Effective from today (7 September), the provider is offering its lite lifetime mortgage at a rate of 4.34 per cent, previously 4.89 per cent, and has reduced its standard product rate from 5.65 per cent to 4.79 per cent.
The maximum loan amount available in the range has increased from £750,000 to £1m, with OneFamily reporting almost 800,000 British homes are valued at this price.
The provider said much of the property wealth sat with the over 55 demographic who have benefited from long-term price increases.
Nici Audhlam-Gardiner, managing director of Lifetime Mortgages at OneFamily, said: "Equity release is no longer a reaction for consumers to make up a savings shortfall but rather a proactive decision to make the most of their largest asset.
"Some homeowners are looking to give loved ones a living inheritance with an intergenerational wealth transfer, while others want to improve their own lives with major home improvements or by investing in other property."
Dean Mirfin, chief product officer at equity release specialist KR Group, formerly Key Retirement, said: "The move by One Family is reflective of the increased consumer demand for equity release from those in higher value properties who may proportionately be looking for higher lending.
"There is a disjoint between equity release rate movements, especially roll up rates which are less determined by BOE rates as funding models are very different to those of mainstream lending.
"Importantly rate alone plays a lesser part in some equity release advice as criteria, for example loan amount available, may be the driving factor. Once needs are met in terms of criteria then rate comes into play."
rachel.addison@ft.com
