Lending to older borrowers edged upwards in the second quarter of the year, with UK Finance data showing both volumes and values of later life loans rising, though growth varied across product types.

Between April and June, 33,130 new loans were advanced to borrowers in later life, a 0.49% increase on the same period in 2024. The total value of this lending rose 3% year on year to £5.2bn.

Lifetime mortgages accounted for much of the expansion, with 5,830 new loans advanced, up 3.7% on last year. The value of this lending was £520m, a 10.6% rise. Retirement interest-only mortgages, by contrast, fell back, with 305 new loans advanced, 2.6% lower than a year ago, while the £25m value was down 10.7%.

Later life lending made up 7.95% of all residential loans in the quarter and 22.54% of all buy-to-let advances.

Simon Webb, managing director of capital markets and finance at LiveMore, said the figures underlined the increasing importance of this segment. “Later life lending is no longer a niche – it’s a fundamental part of the mortgage market,” he said, pointing to a 132% rise in applications and 58% rise in completions at LiveMore in the first half of 2025 compared with a year earlier.

Mary-Lou Press, president of NAEA Propertymark, said the uplift pointed to lenders’ growing willingness to serve older borrowers but cautioned that affordability pressures were pushing some people to borrow for longer.

“It can also be a case that tough decisions are being made by people who are finding affordability a challenge earlier in life and considering taking finance over longer periods than any point previously,” she said.

Richard Pike, chief sales and marketing officer at Phoebus, said lenders would need the right systems to manage demand. “The overall rise in later life lending comes as the market adjusts to the recent interest rate cut and continued cost-of-living pressures. For lenders, the challenge is meeting this demand efficiently and responsibly,” he said.

Clare Stinton, head of workplace saving analysis at Hargreaves Lansdown, noted that 4,780 mortgages worth £570m were taken out in Q2 by borrowers aged over 70, underlining how borrowing is stretching further into retirement.

“Paying a mortgage into our 60s, or beyond, could soon become the new normal,” she said. “It makes an even stronger case for paying into your pension as early as possible.”