Responsible Lending has introduced a new lifetime mortgage at 2.45%.

The introduction of the new rate — equivalent to a 2.42% MER or monthly interest rate — follows recent reductions to 2.78% AER (2.75% MER) in late April and 2.51% AER (2.48% MER) in mid-May.

The provider says this is being driven by distress in equity markets, rock bottom central bank interest rates and the continued strengthening of the equity release market.

Responsible Lending’s new rate is available both with and without drawdown, and available on a sliding scale of LTVs dependent on age.

For example, a single customer aged 70 could access the rate with an LTV of up to 24% (for joint applications the LTV is up to 23% but the rate moves up to 2.50% AER (2.47% MER)).

The minimum loan amount is £10,000 and the product has fixed and defined early repayment charges (ERC). Customers can also repay up to 10% of their loan each year without incurring an ERC.

Responsible Lending’s new product is available through Responsible Life.

Keith Haggart, managing director of Responsible Lending, said: “Rates on lifetime mortgages have never been lower than this and they just keep getting better as funders flock to the long-term reliability of these investments.

“This trend is steering lifetime mortgage products into a virtuous circle as attractive rates boost consumer interest, which in turn continues to create downward pressure on the cost of borrowing.”