Advisers could miss a big opportunity to provide later life lending to their over-50s clients, warned Key Later Life Finance.
More than two out of five mortgages now run past retirement age, according to Bank of England (BOE) figures, however, Key has highlighted that advisers often overlook options for older borrowers.
Many over-50s worry about being accepted for new loans due to their income and end up on expensive rates or accept poor product transfers.
Key has urged advisers to actively engage with older customers and explore the full range of later-life lending options.
This aligns with their obligations under Consumer Duty and recent Financial Conduct Authority (FCA) guidance asking firms to ensure customers have considered all their options.
Retirement income figures suggest challenges in carrying debt into retirement, but accumulated property equity is a valuable asset that should be part of financial planning.
Mortgage advisers have helped many to climb the property ladder, but must now evolve their approach for good outcomes in later life.
Key pointed out that advisers often overlook affordability and omit crucial health or lifestyle information.
Such details are vital for finding the best customer outcomes due to market product innovations.
Will Hale, CEO of Key Advice, said: “All advisers have an obligation to consider all later life lending options for over-50s customers under Consumer Duty but too few are doing that and therefore failing their customers.
“Too many focus on their own area of expertise and do not think more widely.
“There is a huge opportunity for mortgage advisers to grow their businesses and improve their customers’ lives by focusing more on this sector and ensuring they stay abreast of all the product innovation taking place.”
Hale added: “Technology can help with tools such as Air’s Navigator or LiveMore’s Mortgage Matcher offering efficient ways of comparing products and supporting advisers in evidencing the consideration of all options.”
“Having trusted referral arrangements in place is then critical to ensuring that a customer can access all products that may deliver the best outcome for them with as little friction as possible.”
