Later life lending grows by 13.4% as homeowners tap into property wealth

“More people recognise that property wealth can play a genuine role in funding their financial goals,” said Later Life Proposition Manager at Mortgage Advice Bureau.

Later life lending rose in the second quarter of this year, with 37,300 loans advanced to borrowers over the age of 55, according to latest data from UK Finance. This marks a 13.4% increase on the same quarter a year ago and reflects a total lending value of £6.2 billion (also up 20.5% year-on-year).

Within this number, there were 5,730 new lifetime mortgages advanced; while this is 1.7% less than a year ago, it’s an 8% improvement on the first quarter of this year. What’s more, 323 retirement interest-only (RIO) mortgages were advanced between April and June – up 5.9% year-on-year.

However, the trade association was quick to caveat that any comparisons to 2025 are inflated due to the dip in lending following the rush to beat Stamp Duty changes that came into effect from April 2025.

Nevertheless, Levi Culshaw, Later Life Proposition Manager at Mortgage Advice Bureau, said that growth also coincides with “more people [recognising] that property wealth can play a genuine role in funding their financial goals, rather than being treated as a last resort”.

“We’re increasingly seeing customers approach later life lending with a clear purpose in mind – whether that’s boosting retirement income, supporting their family, or even ticking off that once-in-a-lifetime trip. This shift in mindset, alongside greater product flexibility and competitive rates, is likely behind the renewed momentum we’re seeing in the data,” he explained.

Could later life lending help to achieve your goals?

With the cost of living steadily rising and changes to inheritance tax on the horizon, releasing money from their property may become a more appealing option for some homeowners in later life.

“A lifetime mortgage could help homeowners who wish to use some of the wealth built up in their property to help fill a shortfall in retirement, or cover future care costs, without having to move home,” explained Rachel Springall, Finance Expert at Moneyfactscompare.co.uk. Some might also be looking for ways to fund home improvements or give their loved ones a financial gift.

But, Culshaw said that “many people still rule out later life lending because they wrongly believe it means losing their home, leaving their family with debt, or having no inheritance to pass on”.

“The reality is far more flexible than outdated reputation suggests, and speaking to a specialist adviser is the best way to understand what’s genuinely possible for your individual circumstances,” he explained. However, it’s still crucial homeowners fully understand the consequences of releasing equity from their property and diminishing the size of their estate.

Meanwhile, further innovation and choice for older borrowers could be on the cards in the future, with Springall highlighting that the Financial Conduct Authority (FCA) is looking into whether change is necessary in the lifetime and RIO mortgage sectors to better meet consumers’ needs. Interim findings are expected towards the end of this year.

Speak to an expert equity release adviser today