"Some older borrowers may present a more reliable lending proposition than they realise and a valuable revenue stream for brokers. "
- Charlotte Grimshaw, Suffolk Building Society
60% of brokers say they have seen an increase in later life enquiries within the past 12 months, according to new research by Suffolk Building Society, with only 3% seeing downturn in enquiries from over 55s.
Some of the most common reasons brokers reported for clients seeking a mortgage later in life reflect growing financial pressures, either on the clients themselves or on younger members of their families.
66% reported clients coming to the end of a mortgage term and not being ready to repay their existing mortgage in full. 47% saw clients needing to remortgage, with the same proportion (47%) servicing clients wanting to raise money to help family members.
Other frequently cited reasons by brokers stem from their clients’ changing personal circumstances, including raising money for home improvements, or debt consolidation (43%), and a significant life event (such as a divorce) causing borrowers to need a mortgage for a longer period of time (31%).
While the number of older borrowers have increased, yet many are unaware how the market has changed.
64% of brokers said older borrowers still think that all lenders will have age restrictions and 57% of brokers indicated that older borrowers believe that equity release is their only option.
55% of brokers have worked with older borrowers concerned about whether they can borrow for a sufficiently long term and 54% noted that older borrowers are unaware of the different options for evidencing affordability (i.e. pensions and investments).
Suffolk Building Society’s head of intermediaries, Charlotte Grimshaw, commented: “Borrower perceptions have not necessarily kept pace with the innovation we’ve seen in the mortgage market. If many over-55s still assume their age will count against them, then now is the time for brokers to challenge those outdated views and help clients understand the options widely available.
“Rather than waiting for older borrowers to rule themselves out, brokers can start the conversation about later life lending, explain how lenders assess retirement income and other assets, and show that being over 55 is not, in itself, a barrier to borrowing. In fact, some older borrowers may present a more reliable lending proposition than they realise and a valuable revenue stream for brokers.
“Borrowing later in life is increasingly becoming the norm - half of our applications now come from people aged over 55 - and the reasons for doing so are as varied as the borrowers themselves. For brokers, that presents multiple possibilities. By helping older clients understand that they may have more options than they realise, and that age alone does not have to stand in the way, brokers can build stronger relationships, tap into a growing area of the market, and feel good about what they’re doing at the same time.”
