The lifetime mortgage market has weighed in on today’s news that the value of equity release lending in Q2 rose 27 per cent year-on-year to £701m, according to new figures from the Equity Release Council.
This figure is the highest for any quarter since the ERC started keeping figures in 2002.
More signposting needed
Key Retirement technical director Dean Mirfin says: “The expansion is impressive but it should be even higher were lenders doing more to signpost equity release to their interest-only maturities.
“There are an estimated 10,000 borrowers this year alone who have either a shortfall or no way to repay their loan and a significant number are going to have a problem.
“Most of the interest-only customers approaching us are finding us themselves. Some lenders are on board with offering wider solutions including equity release but this is still in the minority, and we hope more lenders start to do more.”
More to come
More 2 Life channel marketing director Stuart Wilson says: “These record breaking results are the latest sign of a burgeoning equity release market. More older homeowners than ever are looking to unlock their housing wealth in later life to help boost their retirement finances.
“With the number of new plans agreed this quarter up by 27 per cent year-on-year, the market looks set to break more records throughout 2017, as equity release products take huge strides towards becoming a mainstream retirement solution.”
Legal & General Home Finance managing director Steve Ellis says: “It’s been another fantastic start to the year for the equity release market.
“However, despite record growth, this is a market that has far more potential. Providers need to continue to meet the needs of consumers with more, flexible products, but all parties must work together to encourage the many already qualified advisers who do not currently provide advice in this sector to talk to their clients about lifetime mortgages.
“The potential for this market to grow yet further is there, but the existing distribution is key – it just needs to be activated.”