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Following a record-breaking year for equity release in 2016, lifetime mortgages – the most common product allowing over 55s to unlock housing wealth in later life – are now the fastest-growing segment of the mortgage market, according to the Equity Release Council.
Which could bode well for Shawbrook Bank’s launch of a new 55 Plus Interest-Only mortgage, available UK-wide and aimed exclusively at borrowers aged 55 or over who are nearing the end of their existing interest-only arrangement but have an outstanding balance.
An estimated 600,000 interest-only borrowers will see their mortgages mature before 2020 and almost half are expected to have a shortfall, either as a result of a planned repayment vehicle not maturing as predicted, or perhaps a reliance on property price growth, which has slowed in recent years.
Maeve Ward, Shawbrook’s managing director of residential mortgages, commented: “This new product not only provides peace of mind to those who do not want to sell their homes or withdraw from their pensions, but also gives them the opportunity to borrow further to fund future plans. I am thrilled Shawbrook is removing ‘age’ as a barrier, putting these valued customers’ needs first and offering something currently not widely available from mainstream lenders.”
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