An increasing number of people aged 65 and over are using equity release products to pay off debts and mortgages, according to new customer data published by LV=.

New figures from the insurer revealed that 27% of its customers used equity release to clear their mortgage, loans or debts in 2019 – compared to 15% in 2016.

LV= suggested it has also seen an increase in customers using equity release products to help family and friends – rising from 8% to 16% over the same period. The figures for those making home and garden improvements fell over the same period – from 32% to 24%.

“Over the past four years, the equity release market has grown significantly as more versatile products have been introduced to meet changing requirements of customers,” LV= strategic sales manager, Georgina Oxton, commented.

“However, it is striking how the reasons why people are using equity release are changing. With pension income often being less than hoped for and high levels of consumer debt, an increasing proportion of customers are using the equity in their homes to pay off loans and outstanding mortgages.

The insurer’s figures also showed that a larger proportion of women (55%) had been taking out equity release plans than men (45%).

LV= also revealed that since 2002, it has served 14,183 equity release customers, lending £1.18bn in that time.

Oxton continued: “For customers with interest-only mortgages having no means of repaying them, equity release would be one option as people have the added security of still living in their home until they die or go into long-term care.

“Helping grandchildren with deposits for their first home or the costs of higher education are just some of the reasons why an increasing number of our customers use equity release to help friends and families.

“Equity release is proving popular with women for a variety of reasons. More women are retiring with relatively small pensions due to the fact that they generally live longer than men, earning lower wages and rising divorce rates for the over-60s.”

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