Mortgage advisers need to adapt in order to thrive as later life lending sector grows
11 July 2025
FCA highlights need for ‘more effective, holistic advice to overcome lack of awareness’
11 July 2025: Mortgage advisers need to adapt to the growing later life lending market in order for their businesses to thrive now and in the future, Key Later Life Finance, the UK’s leading equity release adviser, says.
It points to the strong focus on later life lending in the recent Financial Conduct Authority Mortgage Discussion Paper and believes it shows that mortgage advisers need to adapt their propositions to aging customer bases to future proof their businesses.
The FCA paper warns that ‘older people may not know about the full range of options available to them as they approach retirement’ and says it ‘could be that older borrowers need more effective, holistic advice to overcome this lack of awareness’.
It cites data showing that 38% of people of working age are estimated to be under-saving for retirement and 22% of working people feel unprepared for retirement because they do not understand their options. Property wealth can be a vital part of retirement planning but customers are not receiving the advice they need to access later life lending solutions.
It is urging mortgage advisers to adapt to the changed mortgage market by focusing more on older borrowers which they have previously served. The FCAs recent consultation paper, CP 25/11 states that since 2015 97% of new mortgage sales have been advised meaning that most older borrowers will have a relationship with a mainstream mortgage broker. Having a greater focus on re-engagement with existing customers and expanding the range of products they offer will enable mortgage advisers to deliver better customer outcomes and boost their own income without having to explore expensive new acquisition channels.
Key Later Life Finance says referring older clients to a later life lending specialist can be a sensible option for many mainstream advisers. A referral partnership will earn additional revenue and ensure Consumer Duty obligations around the need to consider all options are met in order to deliver good customer outcomes, whilst allowing advisers to maintain their current scope of advice.
Will Hale, CEO Key Advice, said:
“The message from the regulator is loud and clear, mortgage advice must embrace the needs of older borrowers. Entrenched silos in the intermediary ecosystem mean that many customers are not being offered access to potentially life-changing later life lending products.
“Products targeted at older borrowers, such as modern lifetime mortgages that include interest-servicing options, are increasingly mainstream and mortgage advisers should be routinely considering them, not only to ensure good outcomes but also to boost their businesses.
“Many mainstream advisers may want to develop their advice propositions to better serve their older customers. However, robust triage processes accompanied by referral partnerships with later life lending specialists can be part of the solution for a better functioning market that works in the interests of older borrowers delivering improved outcomes and an environment where advisers and advice businesses can thrive.
“Advisers must engage with the FCA discussion paper and make sure their voices are heard. Trade bodies also have a crucial role to play in representing the views of their members but they must be prepared to compromise and collaborate and be bold in landing a vision for the sector. We now have a moment in time opportunity to influence meaningful change and create a market that works effectively for all stakeholders.
