Understanding later life lending: A guide for intermediaries

Looking for later life lending options for your clients?
Getting the right financial support in later life shouldn’t be a challenge. Whether your clients need to release tax-free cash or secure a new mortgage, we take a flexible approach to later life lending.
There’s no ‘one size fits all’ approach at Family Building Society. We’re flexible in the way we consider income and can consider a wide range of income streams to assess affordability. We don’t credit score but instead carry out tailored credit checks and will look at each application on a case-by-case basis which makes a huge difference. We’ll always try to find the right solution for each individual.
It's important to weigh up the costs, interest rates, and repayment options, as well as any impact on means-tested benefits or inheritance.
Let's dive in and explore the different types of later life lending options in more detail, including what it means for your clients to borrow at a later life stage.
All paths should be considered
Equity release was the go-to for those wanting to borrow in later life but there are many other alternatives that can be a better fit for you client.
Retirement Interest-Only (RIO) mortgages were deemed to be the magic bullet when they were introduced in 2018 but fewer than 1,200 RIOs are sold per year - far below expectations. The death-stress rate has significant implications which has made passing affordability a real issue for many.
Standard mortgages can be a better option and many lenders can now offer mortgages with terms that stretch to much older ages. At Family Building Society we can lend up to age 95 at end of term for an Owner Occupier Repayment mortgage, or up to age 89 at application for an Owner Occupier Interest-Only or a Buy to Let mortgage. Using a standard mortgage can be a much more cost-effective way of borrowing in later life, or can be used before a client is ready to go down the path of equity release.
Joint Borrower Sole Proprietor (JBSP) mortgages can be an option for those in later life who want to support family members financially, as the same age criteria applies. JBSP can also be used in reversed so adult children can help parents with affordability if needed.
The role of Joint Borrower Sole Proprietor in later life lending
Many clients would love to help a loved one get on to the property ladder but are equity rich and cash poor. A Joint Borrower Sole Proprietor (JBSP) mortgage allows family member to help with affordability without the need to gift or loan.
JBSP allows multiple applicants to support a mortgage application without being named on the property deeds. Up to four incomes can be used for affordability - one or two borrowers (who will own and occupy the property) can be supported by up to two other family members.
A great benefit of this is that supporting family members will not be liable for stamp duty on a second home. In 2024, we broadened the family members who are able to support the mortgage to grandparents, aunt, uncles and siblings.
Many clients in later life struggle to meet affordability requirements on their own where their income has reduced - possibly due to retirement, bereavement or a ‘grey divorce’. In this case reverse JBSP can be a game-changer. This enables adult children to help their parents if they’re struggling to meet affordability and can allow parents to stay in their much-loved family home for longer.
At Family Building Society, we know that no two families are the same, which is why our JBSP criteria are designed to be flexible. If your clients could benefit from a little extra financial backing while keeping their home in their name, it’s time to explore JBSP mortgages because sometimes, the best financial plans really do run in the family.
Affordability checks that work in real life
Affordability is at the heart of later life lending, but it’s not just about payslips. Lenders like us who have a manual under-writing approach, will look at a whole range of income streams to assess affordability on a case-by-case basis.
- Earned income up to age 75 (or 70 if the client is in a manual role)
- Up to 90% of pension pots and investments divided over the mortgage term
- Pension income (state, private, or occupational)
- Rental income (evidenced on an SA302)
- Stocks and shares ISAs
- Remuneration drawn by limited company directors (where the applicant is not actively running the day-to-day business operation).
At Family Building Society, we know life (and income) doesn’t always follow a neat formula. That’s why we take a flexible approach to assessing affordability based on a customer’s various sources of income.
As an intermediary, that means more opportunities to help clients stay in the home they love, with a solution that suits their lifestyle and future plans.
Fixed or variable rates: What’s right for your client?
When it comes to later life lending, interest rates aren’t a one-size-fits-all decision. Some clients like the peace of mind that comes with a fixed rate knowing exactly what they’ll pay each month, with no surprises. Others might prefer the flexibility of a variable rate, especially if they’re happy to take the risk of rates changing in the future.
As an intermediary, helping clients choose the right option is all about understanding their attitude to risk, their long-term plans, and how much certainty they want when it comes to managing their money.
Tax, benefits and costs: what to watch out for
Releasing equity from a home can open up all sorts of opportunities, but it’s important for clients to understand how it could impact their wider financial position.
This is where good advice makes all the difference. Encouraging your clients to speak to a tax specialist will help them make informed decisions and avoid any unexpected surprises later on.
Using mortgage calculators to guide the conversation
Sometimes the best way to bring later life lending to life for a client is to show them the numbers. Intermediaries mortgage calculators are a simple but powerful tool to help clients see what’s possible when they are looking to borrow money based on their property value and financial situation.
Mortgage calculators are also a helpful way to explain how a loan secured against a property works. They help to show the impact of different lending options – for example how interest added over time with products like lifetime mortgages could impact the total amount owed, compared to a standard mortgage where interest is paid off each month.
They can give a quick estimate of:
- How much your client could borrow
- What their monthly payments might look like
- How different interest rates could affect them.
Exploring different scenarios together helps your clients feel confident about their choices and makes sure they understand exactly what they’re signing up for.
Final thoughts
Later life lending isn’t just about being able to afford a mortgage - it’s about helping clients feel confident and secure in the next chapter of their lives. That’s where you as intermediaries really make a difference.
Every client’s story is different. Some need a little extra support with affordability, others want to help family members onto the property ladder or simply make the most of their retirement.
At Family Building Society, we know that flexibility matters. Our later life lending criteria are designed to help you to find solutions that really fit your clients’ needs and not shoehorn them into a rigid high street model.
Staying informed, asking the right questions, and exploring all the options means you can give your clients the guidance they deserve. Later life mortgages aren’t just financial products they’re tools to help people live life their way, with financial freedom and peace of mind.
Ready to see what’s possible? We’re here to help.
Frequently Asked Questions
At Family Building Society, we support intermediaries with the entire client lifecycle, with a range of tools, guides, and calculators.
These frequently asked questions provide some more information about later life residential lending, however if the information you need is not here, please contact our team of BDMs who will be very happy to help.