36% of over-55s still paying mortgages

Its research shows that 68% of equity release specialists have seen a rise in customers with interest-only loans looking for solutions.

Advisers are also reporting an increase in customers who have considered downsizing as a solution but then decided not to go ahead. Its study found 23% of clients who looked at downsizing did not go ahead with key reasons including staying near family and friends and not being able to find a suitable home.

Additionally, around 18% of advisers say clients who went ahead with equity release found their house was valued at lower than they had expected.

Bower believes the recent partnership between Santander and Legal & General to offer lifetime mortgages as an option to customers facing the possibility of repayment shortfalls demonstrates the growing need for new solutions.

Andrea Rozario, Chief Corporate Officer at Bower Retirement Services, said: “The Legal & General and Santander deal is a significant move for the launch of retirement lending but much more needs to be done. Significant numbers of people aged over-55 are paying off mortgages but do not have the range of options they need.

“Downsizing will be appropriate for many but it is also clear that many want to stay in their existing home for emotional and financial reasons and should be able to do so as long as it is in their best interests.”