The Council of Mortgage Lenders (CML) has produced a new report, aimed at giving advice to older people who look to borrow in later life. The passages below are the CML's summary. To view the report, please click on the image, or read it on the CML website directly.
Much has changed in the UK mortgage and equity release markets in the years since the start of the global financial crisis. Regulation has fundamentally changed the sale and advice process for lenders, intermediaries and for consumers in relation to residential mortgages. Equity release lending shrank in the immediate aftermath of the crisis but has since bounced back.
Mortgage lending criteria have been tightened and new affordability and suitability criteria introduced, a move which, for a while, led to many lenders capping the upper age for mortgage borrowing. Although age limits can be justified, this move was reversed in principle by many lenders. However, it remains the case that lending to older borrowers remains subject to restrictions.
In the equity release market, new lenders have emerged and new products have been developed in response to the changing needs of the older population and some of the criticisms of older, less flexible products.
In spite of some relaxations in lending by mainstream residential mortgage lenders and improvements in the flexibility of equity release products, there remain concerns that older borrowers may not be well-served by the market. In particular, this research asks whether the way in which advice is received, delivered and regulated is delivering the best outcomes for consumers.