More people are borrowing into their retirement to help out with debt consolidation and meet day to day living costs
Over two thirds of brokers say lending up to and into retirement in the UK is changing, with greater numbers borrowing into their retirement to ease a combination of debt consolidation and day to day living costs.
In its latest study, Hodge heard from more than 150 brokers it works with, the vast majority of whom all agreed that the number of clients looking to take out a mortgage into their retirement years continues to rise.
Most respondents also said fewer people borrowing into later life today are doing so for aspirational reasons, such as to pay for a holiday or a car, with many looking to subsidise insufficient pension provisions or to help out with daily living costs instead.
As a result, 70% of brokers agree that they need more in the way of education when looking to support their customers lending into retirement. It’s also been interesting to see that 90% of intermediaries feel their customers require a greater level of insight with regards to the solutions available to them too.
Andrea Roberts, national account manager (north) at Hodge, said of the findings: “What’s crucial to note about this feedback is that borrowing into retirement is becoming far less about the ‘nice to haves’ and much more focused on meeting financial liabilities brought about by pension or endowment shortfalls, outstanding debts, rises in the cost of living, and more.
“Put simply, borrowing into a customer’s retirement is becoming more of a necessity for many.”
“It’s really important to us, therefore, as specialists in this area of the market, that we continue talking and listening to our brokers, so that we in turn can continue supporting intermediaries and their customers in the moments that matter,” Andrea continued.
“Our focus here at Hodge has always been to flex and respond to market pressures in a way that best reflects the challenges borrowers are facing, and talking directly to the brokers that we work with is one of the many ways we continue striving to achieve this.”
As a specialist in lending into retirement, Hodge has already made a number of enhancements across its products this year to help customers from an affordability perspective.
These changes have included increasing income multiples and accepting a higher percentage of drawdown pension income based on a customers’ age, and there are a number of additional developments that will be brought to the market over the coming months.
As a market leader in complex lending, Hodge is also running its latest in a series of successful webinars on later life lending and the future of 50+ mortgages. Taking place on May 29th, the virtual event will showcase how 50+ customers are evolving and what opportunities and specialist lending solutions are available in a challenging market.
Hodge is also a driving force behind The Later Life Lending Collaboration events taking place in early June. Developed for intermediaries and hosted by industry experts, the remaining locations include Leeds, Coventry and Swindon, and will discuss the latest hot topics on lending into retirement.
For further information about Hodge and its mortgage products, please visit https://hodgebank.co.uk/.
