Building societies are to review upper age limits for mortgages as part of a package of reforms to tackle the increasing needs for lending into retirement.
The review is one of a raft of measures proposed by the Building Societies Association. The trade body also plans to publish a consumer guide for older borrowers, designed to bring together the pension freedoms, inheritance, equity release, powers of attorney and existing age policies.
In addition, the BSA is seeking to form a cross-industry alliance, bringing together Government and regulatory representatives to discuss how older people are affected by changes in policy and regulation.
The BSA says by 2034 roughly a quarter of the population will be over 65, while house prices, divorce rates and the abolition of a default retirement age all mean that consumers are buying houses later and repaying for longer.
BSA head of mortgage policy Paul Broadhead says: “It is natural for the building society sector to kick-start and lead this work. We already tend to have a more flexible approach to lending with higher and sometimes no age limits and a willingness to assess applications considering an individual’s circumstances.
“The time is right to review lending policies, examine how advice is provided and to work closely with a range of organisations across different sectors to ensure that lenders are equipped with the appropriate tools to respond to the rapidly changing demographics across the UK.”