The interest-only lifetime mortgage would allow borrowers on standard interest-only mortgages with larger lenders to switch to More 2 Life’s product once the term has expired, allowing them to stay on with More 2 Life for as long as they wanted.
Dave Harris, managing director at More 2 Life, said the retirement lender was looking to distance itself from the ‘descriptors’ of equity release and lifetime mortgages. He said instead he wanted to establish the brand as a solution offering a range of lending options for older borrowers.
Harris said: “People still have an negative perception of the equity release industry because the high standard that exists today did not exist 20 years ago. However, from a consumer perspective, it’s one of the safest products on the market, it has to be fully advised and signed off by a lawyer.
“Historically there was supply in the later lending market but unfortunately that’s narrowed, and we see opportunity for a whole of market approach. From our point of view there are two adjacent markets; the definition of the lifetime mortgage as set out by the Equity Release Council with space to innovate further within that particular definition.
“But separate to that there is scope in different products within the retirement lending market, with headline interest rates for non-lifetime mortgage rates still far too high.”
He added that individuals approaching retirement should be asking advisers about the different ways to withdraw equity, as there were opportunities for homes to be used as an asset rather than relying solely on a pension pot.
“There’s an opportunity for the government to look at further liberalisation for pension reforms, there’s currently too much focus on pensions pots, we need to broaden our scope and look at using both the pension and house as an asset,” Harris said.