Loughborough Building Society has increased its maximum loan to value (LTV) to 70% for interest-only mortgages that continue beyond the age of 80.
The change replaces the previous cap of 60% and broadens the society’s later-life lending proposition, enabling borrowers to access greater equity in retirement for a range of uses including home improvements, debt consolidation, second property purchases or re-entering homeownership following divorce.
The new criteria form part of a series of enhancements from the East Midlands mutual designed to support the evolving financial needs of retirees. In September 2024, the lender revised its affordability assessment for borrowers approaching retirement, increasing the maximum income multiple to 4.5x up to the applicant’s stated retirement age, up from 3.5x previously. Crucially, no additional affordability assessment is required when the mortgage term extends past 80. However, for applicants already aged 80 or above, the income multiple remains at 3.5x for both sole and joint borrowers.
Ashley Pearson, head of intermediaries at Loughborough Building Society, said the change underlines the organisation’s commitment to empowering older borrowers.
“As a Society, we recognise that many people in their later years may be seeking lower monthly mortgage repayments, often through longer terms or interest-only options, for a huge variety of reasons,” he said. “Whether clients are consolidating debt, improving their home, or investing in a second property, increasing our maximum LTV cap to 70% on interest-only mortgages beyond the age of 80 provides our intermediary partners with a more comprehensive toolkit to support those later life borrowers with unique financial circumstances.”
He added that the new limit is part of a broader mission to offer borrowers “greater flexibility and financial independence in their retirement”.
Loughborough Building Society’s latest move positions it among a small group of providers offering up to 70% LTV on interest-only terms to borrowers over the age of 80 – a demographic often overlooked by mainstream lenders. By refining its affordability criteria and increasing LTV limits, the Society aims to remove barriers that have historically restricted access to mortgage funding for older clients.
The changes are now in effect and available through the Society’s intermediary distribution network.
