New research has revealed that two out of five estate agents believe that mortgage lending restrictions on over-55 customers are causing problems in the housing market.
According to equity release referral service Key Partnerships, 58% believe the current range of mortgages does not meet the needs of over-55s and 54% want to see more action to help older customers borrow.
But the study found just 41% of estate agents are aware that equity release plans, which enable over-55 homeowners to access existing property wealth, can be used for house purchases.
Key’s research shows around 63% of estate agents want to learn more about using equity release for house purchases while around a third (33%) are regularly asked for information and guidance on equity release.
Older homeowners typically face shortfalls when looking for their perfect last move due the premium prices that many properties for older buyers attract. Whilst they may not need a significant mortgage many are excluded by harsher lending criteria.
Will Hale, director at Key Partnerships, said: “The mortgage market is working to make it easier for the over-55s to borrow with regulators and lenders recognising there is an issue which needs to be addressed.
“However the fact remains that the experience on the ground is that it is still a major problem and the views of estate agents highlight how making it difficult for over-55s to borrow has a chilling effect on the housing market as a whole.
“Estate agents need to focus on solutions when assisting clients and it is clear that older customers would benefit from a wider range of options than offered in the mortgage market. Estate agents who can discuss equity release as a potential alternative are able to benefit from an additional revenue stream by way of a referral commission by introducing potential clients to a specialist adviser as well as secure an otherwise lost house sale.”
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