The latest addition to the RIO market allows homeowners to borrow up to 60% of the value of their homes to help them achieve goals. This could be remortgaging an existing loan, carrying out home and garden improvements, supporting children and grandchildren or to boost retirement income.

The RIO can be used to replace an existing interest-only mortgage or as a new interest-only mortgage.

Legal & General said the amount that can be borrowed will be based upon an affordability assessment, looking at a borrower’s household income and outgoings, to make sure they can keep up payments, both now and at the point they are no longer working, if they are not already retired.

Meanwhile, the eligibility assessment is based upon the lowest income of any joint application in order to ensure that the remaining borrower will still be able to afford the mortgage.

Every month borrowers will pay the interest due on the balance of their mortgage, providing both peace of mind and easier long-term financial planning.

Claire Singleton, CEO of Legal & General Home Finance, said: “There is no longer such a thing as a ‘one size fits all’ retirement, and recent months have shown that plans need to be resilient, but flexible.

“As such, it’s important that the industry adapts in order to provide a truly diverse range of later life lending options that allow people to make the most of their retirement.

“A RIO has the benefit of allowing people to use their home to borrow, while helping them anticipate the long-term costs and impact on their income and assets.

“We know that for many people, their home is both the hub of their family life and one of their most valuable possessions.

“At Legal & General, we want to give people a variety of options to access money from their homes, without having to move.”