A mortgage company is launching a range called ‘Next Chapter Lending’ encouraging borrowers remortgaging at or beyond 76.

Vida describes its range as “an enhanced later life lending proposition” targeting later first-time buyers, so-called mid-life movers, and those remortgaging in retirement.

A statement from the company says: “The proposition reflects the changing shape of homeownership in the UK, with increasing numbers of borrowers purchasing their first home later in life, moving home in their 50s and maintaining mortgage commitments into retirement.”

Vida now defines ‘lending into retirement’ as any mortgage where the term extends beyond a customer’s expected retirement age or beyond their 76th birthday, whichever comes first. 

It says the new-look housing market has three key customer groups:

Later First-Time Buyers – Vida says: “As more borrowers enter the property market in their 40s and 50s, Next Chapter Lending helps provide access to affordable homeownership while offering greater certainty around future affordability and retirement planning.”

Mid-Life Movers – “For customers over 50 looking to move into a long-term home, the proposition provides stable and flexible borrowing options.”

Retirement Re-Planners – “The proposition also supports borrowers in later life who are looking to remortgage, whether to fund home improvements and adaptations, assist family members financially or better manage household costs in retirement.”

For customers within 10 years of retirement, affordability is assessed using the lower of current earned income or projected retirement income; and for customers with more than 10 years until retirement, current income may be used where active pension contributions are being made.

Where over 50% of the mortgage term falls within retirement, affordability is based on the lower current or projected income figure.

However, mortgage terms must end before a customer reaches the age of 86.

A spokesperson for the lender says: “Homeownership journeys are becoming increasingly diverse, and borrowers’ needs are evolving far beyond traditional life stages. 

“ … By providing greater clarity around lending into retirement and recognising a range of income sources, including pension income, we’re giving brokers more confidence when supporting customers whose mortgage needs extend beyond their working lives.”