Lenders are widening the range of mortgage products they offer to older homeowners as more people look to buy into retirement.
Equity release has been the most common way for the over 55s to access the equity in their homes for various purposes.
Retirement interest-only mortgages (RIO) could start to do the same.
Growth in later-life lending
The Cambridge Building Society is the latest lender to launch a retirement interest-only mortgage, the first time it has offered a later-life lending product to those who are at pension age.
As with any new mortgage or remortgage, homeowners need a conveyancing solicitor to carry out the essential legal work on the transaction. Homeward Legal’s nationwide panel of property lawyers has a vast range of experience in dealing with remortgaging, equity release and RIO products.
Dan Baker, product manager at the Cambridge, said: “With an increase in the number of older households and rising house price resulting in higher mortgage values, we recognise there is a growing need in this segment for a mortgage to help those who would like to unlock the value in their property to fund their retirement or support their loved ones.”
The Cambridge’s RIO mortgage is on offer to existing borrowers who want alternative funding when their current mortgage terms ends and also to new customers who want to free up equity in their property.
With more older homeowners than ever helping other family members to get on the housing ladder or accessing the value of their property while they’re still living in it, equity release and RIO mortgages are continuing to grow in popularity.