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Lending age caps should be got rid of, older borrowers say

New research conducted by retirement lending specialist more 2 life has revealed that older borrowers want to see age limits on lending scrapped. This comes as the pension revolution shows the need for new solutions to maximise retirement income.

The nationwide poll found that almost 37% of over-55s are of the opinion that no maximum ages should be imposed by lenders. A further 47% said that lenders should base decisions on a borrowers' ability to pay rather than how old they happen to be.

The research also showed that retired people want more borrowing solutions aimed specifically at them – so much so, two out of three over-55s would like to see regulated lenders launching loans and credit cards for retirees.

“Pensioners and those in the run-up to retirement need flexibility and are entirely capable of making informed and sensible decisions as long as there are lenders willing to lend,” said Dave Harris, managing director at more 2 life.

“Regulators have quite rightly focused on the need to stop irresponsible lending but that is having a chilling effect on lending to responsible borrowers and even those in their forties, as recent FOS rulings have shown.”

He added: “Retirement lending will be a growth area in the future as innovation in retirement income planning develops and it is one that the industry as a whole should be looking at now – one of the drivers for that growth will be the huge number of Interest Only Mortgages due to mature over the next 15 years or so where the borrower has no means of fully repaying their debt.”

According to more 2 life's research, 17% of over-65s expect to borrow, or have already borrowed, money in retirement. Meanwhile, FCA figures suggest that 40,000 interest-only mortgages will be maturing each year between 2017 and 2032 where the borrower is aged 65 or above.

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