Rising curiosity and mortgage charges are driving monetary anxiousness for a lot of throughout the UK. As a lot as 28 per cent of over-55s concern they couldn’t afford to repay their mortgage if it moved onto their lender’s Normal Variable Fee (SVR), new analysis from mortgage lender Perenna reveals.

One other 36 per cent would discover it troublesome to handle mortgage repayments, bringing the full who might wrestle to 64 per cent and probably placing many into monetary misery, Perenna defined.

Due to this, later-life debtors going through points are sometimes left to resolve between promoting or downsizing. At present, 37 per cent are contemplating promoting their properties to relocate or downsize. This rises to 48 per cent in London, the place property costs are 34 per cent larger than the typical property value within the UK.

Lenders normally place end-of-term age restrict restrictions for older debtors attempting to safe a brand new mortgage or remortgage. Because of this, 60 per cent imagine there’s a lack of alternative and monetary merchandise tailor-made to them, and 36 per cent discover their mortgage restrictive due to their age profile, being essentially excluded from the mortgage market.

The state of affairs additionally raises issues about a rise in monetary exclusion. As life expectations rise, the demand for mortgage merchandise that cater to older demographics grows, with 18 per cent of respondents stating that mortgage repayments have restricted their capacity to journey or have interaction in leisure actions.

An extra 17 per cent report an impression on their monetary stability and talent to assist their household, whereas 9 per cent have postponed retirement plans to repay their mortgage.

Launching assist

The analysis comes as Perenna launches its Retirement Curiosity Solely (RIO) mortgage for these aged over 55 who need flexibility and optionality. As of 15 February 2024, it’s at present a market-leading long-term mounted charge RIO product, beginning at 5.84 per cent (as much as a most 60 per cent LTV).

Arjan Verbeek, CEO and co-founder of Perenna, mentioned: “The present UK mortgage market is ageist. A complete demographic is being unfairly excluded and left behind, due to their age. We expect that’s mistaken.

“The dearth of choices out there for folks over 55, underpinned by a concern of being trapped of their supplier’s SVR, is placing many in monetary misery. This shouldn’t be the case. Retirees ought to have options out there to reside the lives they want and deserve. Our new long-term mounted charge retirement interest-only mortgage is a step in direction of monetary freedom for older householders.”

Perenna’s new RIO product consists of all the advantages that long-term fixed-rate mortgages supply; in an effort to present householders peace of thoughts.