The Intermediary – July 2025 - Flipbook - Page 11
lifecycles, later life lending is no longer a
Transforming
specialist corner of the industry, but a central
Later Life
thread in the broader mortgage narrative.
Borrowing beyond the age of 55 has been
treated as a siloed sub-sector, segmented off from
DAVE HARRIS, CEO,
traditional advice pathways and engaged only
M
MORE2LIFE
as a reactive solution. But the evolving needs of
customers – who are now just as likely to hold
mortgage debt into retirement as they are to
enter the market in their fifties – demand a more
integrated approach.
retirement than ever before. Property wealth has soared, with
older homeowners sitting on more substantial levels of equity. It’s
Boyd observes: “Later life lending is
increasingly becoming mainstream, and the
recent discussion paper from the FCA on the
future of the mortgage market has the potential
to make it even more so.”
He points to a growing appetite among
residential advisers to support clients throughout
their lives, noting that “they are keen to continue
the relationship with individual customers”
rather than hand them off at a certain age or
life stage.
Batty agrees that both lenders and advisers
must begin “breaking down barriers between
standard residential mortgages and later life
lending,” particularly as more clients carry debt
past retirement.
turning later life lending from what has historically been a niche
product into a more accessible and required financial tool.
There’s a misconception that owning property equals financial
security. Rising living costs and interest-only mortgages maturing
without a repayment vehicle, for example, have been drivers of this
longer-lasting debt. As has the ‘Bank of Mum and Dad’ effect,
where parents or grandparents want to help children onto the
housing ladder. Inflationary pressures mean pensions sometimes
fall short of maintaining the lifestyle people expected. The result
is more older borrowers who would benefit from unlocking their
property wealth in order to support their retirement.
Housing policy still lags. Many older homeowners feel trapped
because there’s not enough suitable housing or incentives to
downsize. We must look closely at reforms around Stamp Duty
and housing supply to give people real choices.
The industry is very good at understanding motivations for
With 68% of first-time buyers in 2024
borrowing for terms of 30 years or more, a
significant proportion of future retirees will still
be making repayments well into their sixties
and seventies. The result, as Batty and others
make clear, is a new kind of borrower – one
who expects holistic, long-term support, not
fragmented advice at the margins of retirement.
Carter notes that property wealth will
undoubtedly play a larger role in retirement
planning in years to come, but stresses the need
to build awareness early, well before a borrower
reaches their fifties or sixties.
The opportunity lies not just in selling more
products, but in shaping a coherent journey
for customers that reflects the full arc of their
financial lives: from first mortgage to family
support, and from midlife planning to late
retirement stability.
For advisers and lenders alike, the challenge
is to move beyond segmented thinking and
embed later life borrowing into the broader
financial journey – treating it not as an end-stage
solution, but as a strategic tool that evolves with
the customer.
The market is reframing the conversation,
not around shortfall and necessity, but around
planning and informed choice.
As Gregory puts it, this means “repositioning
equity release and later life funding as a financial
planning product, not just a safety net.”
We’re living longer and carrying more debt into
these forms of borrowing. While some want to do things like
support family or improve their home, for others it’s about
tackling existing debt or covering essential expenses. It’s
crucial for advisers to really sharpen their focus and ensure the
conversations they have with their clients allow them to truly
understand their goals, while lenders must keep innovating to
make sure our products line up with those wants and needs.
Brokers should proactively start these conversations, even if
clients don’t ask. Education, both for advisers and consumers,
is crucial. For lenders, it’s about innovation, but also supporting
advisers with training, tools, and clear communication.
The market is moving in the right direction, but we are only
scratching the surface of what later life lending could be. Let’s
not forget that the regulator also has a major role to play – the
FCA Discussion Paper suggests it is willing to look at addressing
regulatory barriers in the Handbook that are preventing
firms delivering good outcomes, including the current advice
qualification split, facilitating the review of all options for all older
borrowers. That would be a big step forward.
The big opportunity is to embed later life lending into wider
holistic financial planning. Housing wealth can transform
retirement outcomes for millions. It is the missing link in many
retirement plans, and as more clients understand how it can
support them, demand will grow.
It’s imperative we handle this growth responsibly, with robust
advice, transparent products, and genuine focus on customer
outcomes. The industry has made huge strides in improving
standards, but we can’t afford complacency. Done right, later life
lending could transform financial security for millions of people.
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July 2025 | The Intermediary
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