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Santander looking at equity release move

Santander is considering a launch into the equity release sector next year.

There are few details about what its proposition may look like but the bank has confirmed it is considering launching a lifetime mortgage.

A spokesman for Santander says: “As a responsible lender it is right we consider all options for allowing customers to stay in their homes and we are doing this. 

“Offering a lifetime mortgage is one option we are considering for 2015.”

As a sector, equity release is enjoying strong growth, with figures published by the Equity Release Council last month revealing 5,565 new customers used equity release during Q3 2014, a 12 per cent increase compared to the same period in 2013 and the largest single quarter since 2008.

Further, the sector gained its first new entrant for almost two years in early 2014, when Pure Retirement, a sister company to Age Partnership, launched with a new drawdown plan available to borrowers aged 70 and over.

Key Retirement group director Dean Mirfin welcomed Santander’s announcement.

He says: “Equity release is growing strongly and the more lenders who are involved in the market, the better.

“The possible launch of a Santander lifetime mortgage demonstrates major banks are waking up to the fact that homeowners are increasingly confident in using their property wealth to improve living standards in retirement. 

“Our research tells us equity release is a real solution for millions of customers, with 28 per cent of those who take out equity release doing so to clear an outstanding mortgage.

“Advice is absolutely crucial when taking out an equity release product – around 90 per cent of sales are currently through advisers – so it will be interesting to see the detail of how Santander plans to sell its lifetime mortgage.

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