Loans to over-55s hit £6.1 billion, up 42.6% year-on-year
UK Finance has reported a notable rise in mortgage lending to older borrowers in the first quarter of 2025, indicating both a shift in borrower behaviour and continued demand for later life financial solutions.
According to the industry body’s latest update, 38,510 new loans were issued to individuals over 55 between January and March, a 33.5% increase compared to the same period last year. The total value of these loans reached £6.1 billion, representing a 42.6% annual uplift.
The data also highlighted trends across specialist later life products. Lifetime mortgage volumes rose by 11.1% year on year, with 5,620 new loans advanced, totalling £530 million — a 39.5% jump in value. Retirement interest-only (RIO) mortgages also saw growth, with 339 loans issued in Q1, up 19.4%. These were worth £33 million, which was 17.9% higher than a year earlier.
Residential loans to older borrowers made up 7.6% of all home loan activity in the quarter, while buy-to-let lending in the same demographic accounted for 21.5% of total BTL loans.
Toby Leek (pictured left), president of NAEA Propertymark, acknowledged the broader implications of the data. “It is encouraging to see the mortgage landscape evolving and making better provision across the board, especially for people who are aged 50 plus,” he said.
“However, there are two sides to the coin to consider. This could also be down to underlying issues regarding the cost of living and how this might be impacting many older borrowers, specifically because they are having to delay paying off their mortgages until much later in life. In addition, shifts in consumer needs could also be down to factors such as higher interest rates and ever-increasing household bills making a substantial dent in affordability.”
Industry players also observed a clear uptick in demand for customised later life lending products. Simon Webb (pictured centre), managing director of capital markets and finance at later life lender LiveMore, said the continued growth in later life lending reflects the evolving financial needs of people in their 50s and beyond.
“Whether it’s helping children onto the property ladder, funding lifestyle changes, or managing existing debt, older borrowers are increasingly seeking flexible, tailored solutions,” noted Webb, who added that they had seen strong interest across both conventional and equity release offerings, with many over-50s not fitting into traditional lending categories.
“An increase in later life lending activity signals that older borrowers are continuing to take a more proactive approach to managing their finances — whether that’s through traditional mortgages, RIOs, or equity release products,” said Richard Pike (pictured right), chief sales and marketing officer at mortgage servicing provider Phoebus. “What’s notable is the continued diversification within this market. We’re seeing borrowers opt for a range of solutions depending on their needs — from managing interest-only mortgage maturities to helping family members onto the property ladder.
“As the market matures, technology, underwriting flexibility and adviser support will all be key to ensuring that later life lending continues to evolve in a responsible, sustainable way.”
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