New lending to borrowers aged 55 and over rose sharply in the final quarter of 2025, according to the latest data from UK Finance.
The industry body’s later life mortgage lending update for Q4 2025 shows 41,100 new loans were advanced to older borrowers during the quarter, up 15.1% year on year. The total value of this lending reached £6.8bn, marking a 20.5% increase compared with the same period in 2024.
The report tracks mainstream residential borrowing among over-55s as well as specialist later life products, including lifetime mortgages and retirement interest-only (RIO) loans, offering a snapshot of how older homeowners are accessing property finance.
Lifetime mortgage activity remained steady year on year, with 5,700 new loans advanced in Q4 – unchanged from the same quarter in 2024 but down 5.6% on Q3 2025. The value of this lending totalled £510m during the quarter.
OLDER BORROWERS
Meanwhile, retirement interest-only lending saw more modest but notable growth. There were 388 new RIO mortgages advanced in Q4, up 13.1% year on year. The value of this lending reached £36m, an increase of 2.9% compared with the same quarter a year earlier.
Later life borrowing continues to account for a significant share of overall activity. Residential later life loans represented 8.02% of all residential mortgages in Q4, while later life buy-to-let lending made up 21.4% of all BTL loans.
The figures underline the growing role of older borrowers in both the residential and investment mortgage markets, as lenders continue to adapt criteria and product ranges to meet demand from an ageing homeowner population.
COST-OF-LIVING PRESSURES
Mary-Lou Press, President of NAEA Propertymark (National Association of Estate Agents), says: “It is encouraging to see that there are ever-increasing financial options for borrowers over the age of 55.
“However, the figures do also highlight that many people are potentially struggling to follow their homebuying ambitions much earlier in life.
“Ongoing cost-of-living pressures continue to impact daily life for many and sometimes hinder hard-fought ambitions to save necessary deposits, while many people are also saving for retirement.
“We sit in a better position regarding inflation and base rates than we did this time last year, and if any interest rate cut happens next month, when the Bank of England Monetary Policy Committee next meets, then this could represent yet another positive step towards helping ease ongoing financial pressures and thus allow additional flexibility to purchase a property.”
STRUCTURAL SHIFT
David Forsdyke, Partner, Head of Later Life Finance, at Knight Frank Finance, adds: “The 15% rise in lending to older homeowners reflects a structural shift in how later life is funded.
“Many people are asset rich but cash poor after decades of house price growth, yet pension provision and savings have not kept pace.
“Buyers are also purchasing their first homes later and taking longer mortgage terms, which means borrowing now routinely extends into retirement.”
MORE MAINSTREAM
He adds: “At the same time, equity release lifetime mortgage lending has remained flat year-on-year. That tells us the later life lending market is broadening beyond traditional equity release and becoming a more mainstream form of borrowing.
“Older homeowners are increasingly using standard mortgages, retirement interest-only products and other structured solutions as part of financial planning, rather than turning to equity release.
“Longer life expectancy means retirement resources must last longer, while many people prefer to remain in their homes rather than downsize.
“We are also seeing more clients access property wealth to support children and grandchildren, or to plan proactively around inheritance tax. Borrowing in later life is becoming normalised, and we expect that trend to continue as attitudes continue to evolve.”
