Hodge research uncovers new trend in lending up to and into retirement in the UK
Over two thirds of brokers report that lending up to and into retirement in the UK is evolving, with more clients borrowing into their retirement to manage debt consolidation and daily living expenses.
A recent study by Hodge surveyed over 150 brokers, with the majority noting an increase in clients seeking mortgages into their retirement years. Most observed that fewer people are borrowing for aspirational reasons, such as holidays or cars, and more are doing so to supplement insufficient pension provisions or cover everyday costs.
As a result, 70% of brokers believe they need more education to support customers borrowing into retirement. Additionally, 90% of intermediaries feel their customers require better insight into available solutions.
“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,” said Andrea Roberts (pictured), national account manager at Hodge, of the findings. “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.
“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.”
Hodge has made several enhancements to its products this year to assist customers with affordability, including increasing income multiples and accepting a higher percentage of drawdown pension income based on a customer’s age. Further developments are expected in the coming months.
Hodge is also hosting a webinar on May 29 on later life lending and the future of 50-plus mortgages. It is also a key supporter of The Later Life Lending Collaboration events in early June, designed for intermediaries and hosted by industry experts.
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