Commenting on the modifications made by the FCA to affordability assessments for lifetime mortgages, Nigel Waterson, Chairman of the Equity Release Council, said:

“We are delighted that the FCA has decided to make a change to mortgage affordability rules when applied to lifetime mortgages. This has the potential to help more consumers make use of options already offered by equity release providers in later life and encourage further innovation within the market.

 

“We have been lobbying on the issue of affordability for lifetime mortgages for some time, and as part of our response to the FCA’s call for inputs at the end of 2015 and I am pleased that they have listened fully to our concerns. The optional payment of interest within a lifetime mortgage is different to that of a residential mortgage with the opportunity for consumers to switch to roll-up when they wish.

 

“This change highlights the growing recognition that equity release has an important part to play in the planning of funding for later life and we look forward to continuing to work the FCA in the future.”