Later life loans make up growing share of residential and BTL markets
Lending to borrowers aged 55 and over increased in the second quarter of 2025, with both the number and value of loans rising compared to the same period last year.
According to UK Finance’s latest figures on later life mortgage lending, a total of 33,130 new loans were advanced to older borrowers in Q2, a 0.49% increase year on year. The value of these loans reached £5.2 billion, up 3% from the previous year.
Lifetime mortgages also saw growth, with 5,830 new loans issued—an annual rise of 3.7%. The value of lifetime mortgage lending climbed to £520 million, representing a 10.6% increase.
Retirement interest-only mortgages declined, with 305 new loans advanced in the quarter—a 2.6% decrease compared to Q2 2024. The value of these loans dropped by 10.7% to £25 million.
Residential later life loans made up 7.95% of all residential mortgage advances in the quarter, while later life buy-to-let loans comprised 22.54% of all buy-to-let lending.
“The latest figures showing overall growth in later life lending underline just how vital this market has become and reflects the growth we’ve also seen at LiveMore,” said Simon Webb, managing director of capital markets and finance at later life lender LiveMore.
“With the recent interest rate cut offering a little relief for borrowers, we’re seeing more people explore the flexible mortgage options now available well into retirement. Later life lending is no longer a niche – it’s a fundamental part of the mortgage market.”
“The overall rise in later life lending comes as the market adjusts to the recent interest rate cut and continued cost-of-living pressures,” added Richard Pike, chief sales and marketing officer at mortgage servicing provider Phoebus. “It’s clear that more borrowers are turning to later life products to unlock flexibility and financial stability in retirement. For lenders, the challenge is meeting this demand efficiently and responsibly.”
The growth in later life lending means mortgage brokers should be prepared to advise more older clients on a wider range of products, including lifetime and retirement interest-only mortgages. Brokers will need to stay informed about evolving options and regulations to help clients make suitable choices, as later life lending becomes a more significant part of the overall mortgage market.
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