The UK’s mortgage industry must improve their response to the challenges posed by an aging society and also become more in line with the rising number of retirees that secure a loan for property. This is the viewpoint of David Sinclair, Director of the International Longevity Centre-UK (ILC-UK), who has also pleaded with the industry to not discriminate against age alone.
Speaking at a conference hosted by the Council of Mortgage Lenders, Mr Sinclair advised the older generation to tread very carefully before pursuing a solid interest in buy to let; or any other investment opportunity that may provide a return on their pension savings. With increasing numbers of retirees taking out loans for homes, the industry has been urged to better equip itself for a changing demographic.
Achieving Better Returns
In the last five years, both the percentage and total number of mortgages extending into retirement has risen significantly, with the average housing wealth being £122,000 for Britain’s pensioners. Lending criteria across the board has tightened in recent years, leading people to take a mortgage into retirement. Property investment can of course be very risky though and does not always guarantee a return.
Nevertheless, the new pension freedoms could spark a buy to let boom in the near future, as income poor and asset rich retirees look at equity release as a way of supplementing their retirement funds. Despite how attractive the prospect seems, older people are being warned to seriously consider all of their options and seek professional advice before making a decision.
A Decision Made in Haste is Time Gone to Waste
As with most decisions in life, if you rush it then the final solution will usually end up being a disappointing one. It is vitally important that you take the time to research, analyse and educate yourself on all options before making a final decision. Even if you have your heart set on a specific method of investment, it’s equally as important to seek help and guidance for the path you have chosen. So make sure you seek professional help and advice in your investment planning process.
P2P Lending is becoming a popular investment alternative offering attractive rates of return. It is important to know that capital is at risk and interest payments are not guaranteed if a borrower defaults. For more information, contact our customer service team on 0800 888 6001, or email [email protected]
Peer-to-Peer Lending is not covered by the Financial Services Compensation Scheme.