The loans advanced to older borrowers in Q1 came to 38,510, up 33.5% year-on-year, a report has shown.
According to the latest figures from UK Finance, which offers insights into mortgages taken out by older borrowers over the age of 55, the value of lending during the period to this segment came to £6.1bn, a rise of 42.6% on the same period last year.
There were around 5,620 new lifetime mortgages advanced during the period, an increase of 11.1% on the same period last year.
The value of lifetime mortgages came to £530m, which was up 39.5% compared with the same quarter a year before.
The report added that there were around 339 retirement interest-only mortgages, a jump of 19.4% year-on-year.
The value of retirement interest-only (RIO) mortgages was estimated at £33m, up 17.9% compared with the same period last year.
Instilling mortgage confidence in the growing self-employed population
Sponsored by Newcastle for Intermediaries
Residential later life loans in Q1 made up 7.6% of all residential loans, with buy-to-let (BTL) later life loans in the first quarter accounting for around 21.5% of all BTL loans.
Older borrowers taking more ‘proactive approach to managing their finances’
Richard Pike, chief sales and marketing officer at Phoebus, said a rise in later life lending activity “signals that older borrowers are continuing to take a more proactive approach to managing their finances – whether that’s through traditional mortgages, RIOs, or equity release products”.
He continued: “In an environment where cost of living remains high, tapping into property wealth or restructuring existing borrowing is becoming an increasingly important part of later life planning.
“What’s notable is the continued diversification within this market. We’re seeing borrowers opt for a range of solutions depending on their needs – from managing interest-only mortgage maturities to helping family members onto the property ladder.
“As the market matures, technology, underwriting flexibility and adviser support will all be key to ensuring that later life lending continues to evolve in a responsible, sustainable way.”
Simon Webb, managing director of capital markets and finance at LiveMore, added that it was “encouraging to see continued growth in later life lending, reflecting the evolving financial needs of people in their 50s and beyond”.
He continued: “Whether it’s helping children onto the property ladder, funding lifestyle changes, or managing existing debt, older borrowers are increasingly seeking flexible, tailored solutions.
“At LiveMore, we’re seeing strong demand across both mainstream and equity release products, driven by this shift. Our growth this year reflects the fact that many over-50s don’t fit the traditional lending mould and we’re proud to be developing solutions that work for them.”