Marie Catch, Head of Mortgage Broker Sales at Legal & General Home Finance
2019 has the potential to be the biggest year yet for the later life lending market
2018 was a year of remarkable growth and change in the later life lending market, but by working together, lenders and advisers could help make 2019 the biggest year yet for the industry.
Legislation and innovation
In March 2018 the Financial Conduct Authority (FCA) called on our industry to offer more choice to customers, giving the go-ahead for Retirement Interest Only (RIO) mortgages. Lenders were quick to respond, and it proved to be a significant step for later life lending.
Many of Britain’s retirees are being forced to adjust their retirement plans to make their income go further, for longer. At Legal & General, we have launched a number of innovative solutions to provide more options for those who want to use their housing wealth in later life. Our Optional Payment Lifetime Mortgage (OPLM) and Income Lifetime Mortgage products are already having a hugely positive impact on the lives of our customers and helping them to enjoy a more colourful retirement.
Engaging advisers
Our industry must recognise that retirement has changed. The customers we’re working with today have vastly different plans, goals and aspirations for later life when compared with those of their parents and grandparents. As a result, it is vital that lenders and advisers understand these plans in order to deliver options that can help customers meet their needs for retirement.
Later life lending has the potential to become a much larger market in the future. There are likely thousands of potential customers who either haven’t heard about lifetime mortgages, or who continue to base their views about equity release on its reputation from the past.
Our challenge over the course of this year therefore is to boost distribution, which means supporting more mortgage intermediaries when it comes to advising on later life lending. We can do this through education, tools, workshops and a helping hand to encourage them to talk to their clients about later life borrowing.
Earlier this year, Legal & General Home Finance announced that it will offer new CII-led workshops for mortgage intermediaries1. The aim of the one-day workshops is to support advisers interested in taking the Level 3 Certificate in Equity Release. Attendees are then offered a follow-up workshop to establish the foundations of dealing with equity release, covering topics such as lead generation.
Engaging advisers in this way can only help to grow the market further over the course of 2019.
Milestones
After a year of significant change for later life lending, Legal & General Home Finance reached a milestone £3 billion of total lending in December 2018. We are now responsible for 28% of new lifetime mortgages in the UK2 – but we refuse to become complacent. That’s why we are committed to keeping up this momentum over the year ahead, helping people have the best retirement they can.
It is our mission to support retirees across the UK to enjoy the retirement that is best-suited to their needs and aspirations. If we can work together as an industry to double the number of advisers talking to their clients about lifetime mortgages, 2019 could be the year that we take great strides towards normalising the later life lending market.
