Two out of three Britons aged over 55 would like to see lenders providing products specifically aimed at the retired, new research from retirement lending specialists more 2 life shows.
A report commissioned by more 2 life reveals that equity release and other retirement lending solutions are set for strong growth in the near future as part of a “seismic shift in the way people fund their retirement”.
Older borrowers want to see age limits on lending scrapped. A much as 37 per cent of over-55s believe there should be no maximum age for lending and nearly half (47 per cent) of them say a borrower’s ability to make repayments should be the criterion lenders base their decision on and not age.
More 2 life says there is high potential demand to borrow in retirement as research has found that almost two-thirds (63 per cent) of over-55s say they would welcome the ability to borrow.
Dave Harris, managing director at more 2 life, said: “Pensioners and those in the run-up to retirement need flexibility and are entirely capable of making informed and sensible decisions as long as there are lenders willing to lend.
“Regulators have quite rightly focused on the need to stop irresponsible lending but that is having a chilling effect on lending to responsible borrowers and even those in their 40s as recent FOS rulings have shown.
“Retirement lending will be a growth area in the future as innovation in retirement income planning develops and it is one that the industry as a whole should be looking at now – one of the drivers for that growth will be the huge number of Interest Only Mortgages due to mature over the next 15 years or so where the borrower has no means of fully repaying their debt.”
The more 2 life research shows 17 per cent of over-65s expect to borrow or have already borrowed money in retirement. Figures from the FCA suggest there will be 40,000 interest-only mortgages maturing each year between 2017 and 2032 where the borrower is aged 65 or above.
