Whether you want to stay in your home, unlock the value of your property, or secure extra funds, there are options to help. Understanding them will guide you in making the right choice. 

In this blog, we will explain the different types of later-life mortgages, how they work, and help you pick the right one for you. 

1. What is a Later-Life Mortgage?

A later-life mortgage is a loan for people aged 50 and older. It lets you borrow money or unlock the value of your home as you near retirement. There are different mortgage options to fit your needs. 

Later-life mortgages can help you: 

• Stay in your home longer by unlocking its value. 

• Access extra funds for retirement or other goals. 

• Choose the best payment option for you, like interest-only or regular payments. 

By checking your options, you can find the right mortgage for retirement. 

2. Types of Later-Life Mortgages

Every situation is different. And the products on offer may evolve over time. To make sure you choose the best option for you, you should speak with a mortgage expert.  

Below are two common types of later-life mortgages. 

Retirement Interest-Only (RIO) Mortgages 

With a RIO mortgage, you only pay the interest each month. This keeps your payments low. The loan is repaid when you pass away or move into long-term care, usually through the sale of your home. This option is ideal if you want to stay in your home without worrying about repaying the loan during your lifetime. 

Key features: 

• Pay only interest each month. 

• Loan repaid when you pass away or move into care. 

• Flexible terms with no fixed end date. 

Equity release 

Equity release allows you to take cash from your home without moving. You can choose to receive a lump sum or regular payments. The loan is repaid when your home is sold, usually when you pass away or go into long-term care. This is ideal for getting extra funds from your home. 

Key features: 

• Access cash from the value of your home. 

• No monthly repayments unless you choose to. 

• Loan repaid from the sale of your home. 

3. Benefits of Later-Life mortgages

Later-life mortgages offer many advantages, including: 

• Financial security: Get extra funds for retirement, home improvements, or other goals without having to downsize. 

• Stay in your home: Many options let you live in your home for as long as you like. 

• Tailored for you: These mortgages are designed for older borrowers, with flexible options to fit your needs. 

4. Things to consider before choosing a Later-Life mortgage

Before you choose a later-life mortgage, think about the following: 

• Your Financial goals: Do you need extra funds for retirement, or are you looking to lower monthly payments? Understanding your needs will help you decide. 

• Your health and longevity:  Mortgages like equity release are typically repaid from the sale of your home when you pass away or move into long-term care. It’s important to consider your health, life expectancy, and future care needs when planning. 

• Repayment plan:  With a RIO mortgage, the loan is usually repaid from the sale of your home when you pass away or move into long-term care. However, it’s important to plan ahead and understand how this fits into your overall financial goals. 

5. How Perenna can help

At Perenna, we believe later-life lending should be clear and fair. We offer long-term, fixed-rate RIO mortgages to give you peace of mind in retirement. 

With a Perenna RIO mortgage, you will enjoy: 

• A fixed interest rate for predictable payments. 

• No age limit – because borrowing should not be limited by age. 

• Flexible options, like the ability to make overpayments after five years with no extra charges. 

We are here to help you choose the best option for a happy and stable retirement. Whether it is a Retirement Interest-Only mortgage or equity release, we will guide you to the right choice for you. 

Want to learn more? 

Use our mortgage calculator to see how much we could lend you and get an idea of your monthly payments. It is quick and easy! 

You could lose your home if you don’t keep up your mortgage repayments. 

Correct at time of publishing. 

You will likely come across two options: Interest-Only (IO) and Retirement Interest-Only (RIO) mortgages. 

They may sound similar, but they have key differences that can affect which one is right for you. 

Let us break them down and help you choose the right fit for your future! 

What is an Interest-Only mortgage? 

An Interest-Only mortgage means you only pay the interest each month, so your payments are lower. It lasts for a set time. 

When the loan term ends, you will need to pay the loan amount back, often by selling your home, remortgaging, or using savings. 

Key features: 

• You pay only the interest each month, keeping payments low. 

• The loan must be repaid at the end of the term. 

• Borrowers need to have a specified way of repaying the loan at the end of the term, which is provable from the outset.  

• Available to all ages but may have strict requirements. 

• Making overpayments over the life of the loan is not an acceptable plan to repay the loan at the end of the term.  

As you only pay the interest, you need a plan to pay back the loan later. This plan is called a “repayment vehicle,” and lenders have rules about what is allowed. 

What is a Retirement Interest-Only mortgage? 

A Retirement Interest-Only mortgage lets you pay only the interest each month, so your payments stay low. 

There is no set end date. The loan is paid back when you pass away, move into long-term care, or sell your home. 

Key features: 

• Pay only the interest each month, keeping payments low. 

• No fixed end date – the loan is repaid when you pass away or sell your home. 

• Available to older borrowers (aged 50+ with Perenna). 

• No need for a repayment plan, as the loan is repaid from the sale of the home. 

A Retirement Interest-Only mortgage is a great choice if you want to stay in your home without a repayment deadline. It helps keep your payments low and lets you stay in your home as long as you want. 

Interest-Only vs. Retirement Interest-Only: Which one is right for you? 

Both mortgages let you pay only the interest each month, but they differ in when the loan is repaid. 

With an Interest-Only mortgage, the loan must be repaid at the end of the mortgage term. You will need a clear plan for how to repay it from the start. 

A Retirement Interest-Only mortgage has no fixed end date. The loan is repaid when you pass away or move into long-term care, usually from the sale of your home. 

How Perenna can help 

At Perenna, we make borrowing in later life simple and fair. That is why we offer a Retirement Interest-Only mortgage with a fixed rate of interest for as long as you need it, so you can feel confident and at ease. 

With our Retirement Interest-Only mortgage, you will get: 

• A fixed interest rate for the long term, so your payments stay the same. 

• Available to borrowers aged 50+, offering more flexibility. 

• No age limit – because borrowing should not depend on your age. 

• The option to overpay after five years with no charge. 

We are here to help you stay in your home and enjoy a worry-free retirement. 

Want to learn more? 

Thinking about your later-life mortgage options? A mortgage broker can help you find the best solution for your needs. Make sure you seek advice to understand your options.  

You could lose your home if you don’t keep up your mortgage repayments. 

Correct at time of publishing. 

We believe your age or being retired should not stop you from getting a mortgage. 

Want to move, remortgage, or unlock cash from your home? Your pension doesn’t have to stop you! 

Good news! Many lenders, like Perenna, accept pension income. The key is finding the right mortgage for you. 

How do lenders look at pension income? 

Lenders may consider different sources of retirement income, such as: 

• State pension: Money from your government pension. 

• Private and workplace pensions: Income from personal or work pensions. 

• Investment income and savings: Some lenders count rental income, dividends, or savings. 

• Annuities and other retirement benefits: Regular payments from retirement plans. 

At Perenna, we take a flexible approach to affordability. We look at your full financial situation, not just your income, to make sure the mortgage works for you now and in the future. 

Mortgage options for retirees 

If you are looking for a mortgage in retirement, here are some options to consider: 

Long-term fixed-rate mortgages 

• Ideal if you have a fixed pension income. 

• With Perenna, your payments can stay the same for up to 40 years. 

• No surprises, no rate hikes – just peace of mind in retirement. 

Standard repayment mortgages 

• If your pension meets affordability checks, you may qualify. 

Retirement Interest-Only (RIO) mortgages 

• Pay just the interest each month. 

• Repay the loan when you sell your home. 

• Available with some lenders, but options may be limited. 

Considering equity release? 

Many think equity release is the only way to unlock funds from their home in later life. But that is not the case. With Perenna, you can borrow and still keep full ownership of your property. 

What to think about when getting a mortgage on a pension 

When exploring mortgage options, think about: 

• Lenders who accept pension income: Not all do, so make sure to choose a lender that does. 

• Predictable payments: Fixed-rate mortgages offer stable payments, helping you budget with ease. 
• Flexibility: Can you move home or repay early without high fees?

Why choose Perenna? 

At Perenna, we believe your age should not hold you back from owning a home. That is why we offer: 

• No maximum age limits – Borrow at any stage of life. 

• Fixed-for-life payments – No surprise rate changes. 

• Short early repayment charges – More flexibility when you need it. 

We don’t have strict age limits like other lenders. Our mortgages are designed to give you options at any stage of life. 

Your retirement, your rules. Let’s make your mortgage work for you. 

Use our mortgage calculator to see how much we could lend you and get an idea of your monthly payments. It is quick and easy! 

If you would like some mortgage advice, that is no problem. We can help you
find a mortgage broker.  

You could lose your home if you don’t keep up your mortgage repayments.   

Correct at time of publishing. 

You may have thought that your options approaching retirement were limited. With some lenders they are! And that may mean you’re not able to borrow what you need.  

But for Perenna, age is but a number. We want to give you more options in later life. It’s time to take back your borrowing power, whatever your age.  

Over 60 and looking for a mortgage? We may be able to help.  

Taking back your borrowing power  

Forget traditional restrictions; our approach lets you secure a mortgage that can suit your needs, no matter your age!  

Predictable payments  

With Perenna, you will never have to worry about your payments going up.  

If you want to know what you’ll pay each month, our long-term fixed rate mortgages could be a great option. We allow you to fix your rate for up to 40 years, meaning you can plan your future with confidence and financial peace of mind. 

Flexibility as standard  

We get it. Fixing your rate for up to 40 years is a long time. You don’t know how your life will look in that time. And that’s why we’ve made sure our mortgage products come with flexibility as standard.  

We want to make sure our mortgage can fit around your life.  And if rates come down and you’d like to change your deal, or make unlimited overpayments, that’s absolutely fine. You can do so without charge after five years. 

Looking to keep payments down?  

If lower payments are a priority, we can offer interest-only options. This allows you to borrow against your home but only pay back the interest each month. Remember, the original amount borrowed is still due at the end of the agreed term. For those people looking for an option in later life, there’s retirement interest-only (RIO) products too.  

Why choose a RIO mortgage? 

A RIO mortgage could be the right choice if you want to: 

• Lower monthly payments: Paying just the interest keeps costs down.  

• Stay in your home: No need to move or downsize. You can access funds without leaving the place you love. 

• Gain financial freedom: Access the value of your home to cover things that matter, like retirement, home upgrades, or paying off debt. 

• Refinance with ease: Simplifies refinancing as you approach the end of your current mortgage term. 

How Perenna can help 

At Perenna, we offer flexible retirement mortgage options with long-term fixed rates to give you peace of mind. Our mortgages include: 

• No age limit: Whether you are 60 or 80, we do not apply age limits to our products. 

• Predictable, fixed payments: With a long term fixed-rate mortgage you will know your payments will not change during the whole mortgage term. This can help you to budget removing worries about increasing payments. 

• Short early repayment charges: We understand that life can change. That is why we offer short early repayment charges if you need to adjust your terms. 

Explore your options today 

If you are thinking about a mortgage after 60? Choose a lender who understands you! At Perenna, we offer flexible terms and to help you make the most of your retirement. 

Use our mortgage calculator to see how much we could lend you and get an idea of your monthly payments. It is quick and easy!

If you’d like some mortgage advice, that’s no problem. We can help
find a mortgage broker.  

You could lose your home if you don’t keep up your mortgage repayments.  

Correct at time of publishing.  

Is equity release the only way to borrow in later life? The answer is no! 

Equity release can work for some people, but there are other options that might suit you better. 

At Perenna, we want to give you more choice. Our goal is to help you enjoy your retirement without financial stress. 

What are your alternatives? 

1. Traditional Mortgages (still an option in your 60s!)

Think you are too old for a mortgage? You are not. 

At Perenna, we don’t have an upper age limit. If a traditional mortgage suits your budget, it could be a great option. 

• Fixed monthly payments – Easy to manage. 

• Pay down the loan over time – Own your home outright. 

A traditional mortgage can also help you build wealth and pass your home on to future generations. If you decide to sell, you could use the proceeds to pay off the mortgage.

2. Long-term fixed-rate mortgages = stability for your future

Many people worry about rising interest rates when taking out a mortgage later in life. A higher rate can increase your payment, which is tough if you’re on a fixed income. 

With a Perenna long-term fixed-rate mortgage, your monthly payments stay the same for the full mortgage term. This gives you certainty and peace of mind. 

Plus, after five years, there are no early repayment charges. So, if you decide to explore other options, like equity release, you can do so without penalties.

3. Retirement Interest-Only (RIO) mortgages

Want to keep your monthly payments low? A Retirement Interest-Only (RIO) mortgage could be the answer. 

With this type of mortgage, you only pay the interest each month, keeping payments lower while preserving more of your home’s value. 

It also provides flexibility during life changes, like after a partner’s passing. 

More mortgage choices than ever before 

In the past, options have been limited for borrowers in later life. But not anymore! 

Whether you want to: 

• Pay off an existing mortgage 

• Fund home improvements 

• Help family with a house deposit 

There’s a mortgage to suit you. 

You could lose your home if you don’t keep up your mortgage repayments. 

Correct at time of publishing. 

Retirement is meant to be your time to unwind, enjoy the things you love, and create new memories. But what if your home could be part of that journey?

With a flexible mortgage, you can transform your home or move to a new one – without dipping into your savings or feeling the need to downsize. Imagine the freedom to make your dream home a reality. Here’s how you could make it happen:

Renovating your home

Retirement could be the perfect time to make your home yours. Whether you are dreaming of a modern kitchen or a cosy living space, the right updates can help you enjoy your home for years to come.

But how do you fund these renovations? A flexible mortgage from Perenna could be the answer. With a mortgage in your latter years, you can access the value built up in your home to fund those home improvements, without having to sell or use your savings.

• Renovate and make your home work for your needs.

• Add property value with upgrades like a new kitchen.

• Enhance enjoyment by creating a space that suits your retirement dreams.

Relocating to your dream home

If you want a smaller home or to live near family, Perenna’s flexible mortgages let you choose what’s best for you. From a cosy home to a practical place, the choice is yours.

• Move to a smaller home or a new area: Be closer to family or find a community you love.

• Easy-to-manage payments: Fixed payments make budgeting simple.

• More choices: No age limits, so you can explore all your options.

Your dream home could be closer than you think with Perenna.

Why choose a flexible mortgage over equity release?

Equity release isn’t your only choice. A flexible mortgage may gives you more control and freedom. With Perenna, you keep full ownership of your home, enjoy more options, and face no age limits.

• Keep full ownership: You stay in control of your home.

• More flexibility: You have more options to suit your needs.

• No limits: No age restrictions, so you can make decisions when it suits you.

How we can make it easier for you:

• Flexible mortgages for later life: No age limits, giving you freedom to choose at any stage of retirement.

• Predictable payments: Fixed-rate plans keep your budget simple, clear, and stress-free.

• Short early repayment charges: Life changes, and we are here for it – minimal charges if you need to adjust your plan.

Ready to start planning your dream home? With a flexible mortgage from Perenna, you can make the home improvements or move you have always wanted.

Use our mortgage calculator to find out how much you can borrow or
find a broker for advice.

You could lose your home if you don’t keep up your mortgage repayments.

Correct at time of publishing.

Is having a mortgage in retirement right for you?  

If the answer is yes, then we can help.  

Planning for a mortgage in retirement can feel overwhelming. But it doesn’t have to be that way! With the right tools and a clear plan, you can take control of your budget and enjoy a financially secure retirement. Here is how to get started:  

Step 1: Know your numbers 

The first step in budgeting is knowing how much money you have coming in and how much is going out. 

• Income: Add up pensions, rental income, and any other reliable sources of funds.

• Expenses: Include your living costs, bills, and any current payments. 

When you know where you stand, it is easier to plan and avoid surprises. 

Need help? Try our mortgage calculator to see how much you can borrow and what your monthly payments might look like. Understanding your finances is the first step to feeling in control.

Step 2: Explore interest-only mortgages 

Looking for smaller monthly payments?
A Retirement Interest-Only (RIO) mortgage might be the right choice. Here is how it works: 

• You pay only the interest each month, not the loan amount. 

• This keeps your payments smaller and easier to manage. 

With a RIO product, you don’t need to repay your loan until you, or if it’s a joint mortgage, the last remaining one of you dies or decides to live elsewhere long term. For example, if you move into a residential home.

With predictable payments, you will have more financial freedom to focus on what makes you happy.

Step 3: Plan for stability 

Retirement should be relaxing, not stressful. That’s why at Perenna, we offer mortgages with the same payment amount for up to 40 years. This way, you’ll always know what to expect and won’t have to worry about changes. 

Here is why fixing your rate matters: 

• Predictable costs: Your payments stay the same, no matter what happens with interest rates in the market. 

• No surprises: You will always know what to expect each month. 

Fixing your mortgage gives you peace of mind and lets you focus on enjoying your retirement.

How can Perenna help? 

Age is but a number. That’s why our mortgages are designed to fit your needs in retirement: 

• No maximum age caps – giving you options at any stage of life. 

• Predictable payments – making budgeting stress-free. 

• Flexibility as standard – short early repayment charges of just five years. We know life doesn’t stop when you retire. Whether you need a mortgage to help with money, fix your home, or enjoy your free time, we’re here to help.

Take control of your retirement 

Budgeting for a mortgage in retirement doesn’t have to be complicated. With the right plan and the right product, you can make it work for you. 

• Try our mortgage calculator to find out how much you can borrow. 

• Find a broker for tailored advice that fits your needs. 

Retirement is your time to enjoy life. Let Perenna help make it easier! 

You could lose your home if you don’t keep up your mortgage repayments. 

Correct at time of publishing 

Times have changed! At Perenna, we are breaking down the barriers to borrowing in later life. Let us tackle the common myths and show you how we make mortgages work for you.

Myth 1: You can’t get a mortgage after 60.

Myth debunked: You can.

Many believe age limits stop you from borrowing, but that is not true. At Perenna, we don’t have age caps. Whatever your age, you still have options. Take back your borrowing power!

Myth 2: Mortgages in retirement are too risky.

Myth debunked: With the right mortgage, they are not.

At Perenna, we offer fixed monthly payments that will not change for up to 40 years. That means:

• No surprises.

• No stress.

• Total predictability.

You can plan your retirement with confidence, knowing your mortgage fits your budget and your life.

Myth 3: Equity release is the only option.

Myth debunked: There are alternatives.

Flexible mortgages, like those from Perenna, let you access funds without reducing the value of your home. Want to free up cash, renovate, or stay in the home you love? We have got you covered. More options = more control.

Myth 4: You can’t get a mortgage with pension income

Myth debunked: You can.

Although some lenders will ignore pension income, Perenna is different. In fact, a long-term fixed rate mortgage can be the perfect match for pension income which is also fixed for the long term.

Why Perenna?

We have designed our mortgages to work for you, not against you:

• No age limits mean more borrowing power at any stage of life.

• Predictable payments allow you to plan with confidence.

• Short early repayment charges provide flexibility when you need it.

Ready to explore your options? Use our calculator to see how much you could borrow and estimate your monthly payments. Or speak to a mortgage broker for expert advice.

Discover how you can make retirement work for you here.

You could lose your home if you don’t keep up your mortgage repayments.

Correct at time of publishing.

Our latest research sheds light on the financial anxieties faced by this demographic regarding mortgage affordability and accessibility. 

Six in ten (60%) of over 55s report a lack of choice and mortgage products tailored to them and over a third (36%) believe their mortgage is restrictive because of their age. 

According to our findings, over a quarter of over-55s (28%) express concerns about affording their mortgage, particularly if it moves to their lender’s Standard Variable Rate (SVR). An extra 36% expect difficulties in managing repayments, bringing the total to almost two-thirds (64%) who may face financial strain. 

 This financial pressure can lead to tough decisions for borrowers later in life. 

Many are left with limited options and are considering selling or downsizing their homes to address their financial challenges. In fact, more than a third (37%) are considering selling their homes to relocate or downsize, with this figure rising to nearly half (48%) in London. 

Traditionally lenders’ age limit restrictions worsen the situation, with nearly two-thirds (60%) of respondents expressing concerns about the lack of tailored financial products for older borrowers. Thirty-six percent feel excluded from the market due to age restrictions, finding their mortgage options restrictive. 

These financial worries not only impact homeowners’ financial stability but also affect their lifestyle choices. Our research reveals that nearly a fifth (18%) of respondent’s report that mortgage repayments have limited their ability to travel or engage in leisure activities.  

Additionally, 17% express concerns about financial stability, while 9% have postponed retirement plans to focus on mortgage repayment. 

 At Perenna, we believe in providing solutions that offer flexibility and give borrowers more options. That’s why we’ve launched our Retirement Interest Only (RIO) mortgage for those aged over 50, featuring a long-term fixed-rate. Starting at a market leading long-term fixed-rate of 5.84% (up to a maximum 60% LTV), our RIO mortgage provides the security of fixed payments over an extended term, ensuring homeowners can enjoy retirement with peace of mind. 

Our CEO and co-founder of Perenna, Arjan Verbeek, emphasised the need for inclusivity in the mortgage market, particularly for older demographics. He stated, “The current UK mortgage market is ageist. A whole demographic is being unfairly excluded and left behind, because of their age. We think that is wrong.“ 

The lack of options for people over 55, compounded by fears of being trapped on their provider’s SVR, is a significant concern. Verbeek continued, “Retirees should have solutions available to live the lives they desire and deserve. Our new long-term fixed-rate retirement interest-only mortgage is a step towards financial freedom for older homeowners.” 

Our new long-term fixed-rate retirement interest-only mortgage is a step towards financial freedom for older homeowners.  

Want to find out more?   

Our mortgages are currently available through mortgage brokers only. So, if you’d like some mortgage advice, that’s no problem. We can help find someone near you. They’ll provide tailored advice based on your mortgage needs. Plus, they’ll know all about our mortgages, so can answer any questions you may have.  

Find a broker. 

 You could lose your home if you don’t keep up your mortgage repayments. 

Notes 

• All data, unless otherwise specified, is taken from 1,003 respondents conducted by Censuswide in January 2024 – all respondents were homeowners aged 55+ and either heading into retirement or already retired. 
• Censuswide abide by and employ members of the Market Research Society which is based on the ESOMAR principles. 
• “Market leading” – determined by lowest fixed for life retirement interest only product on the market as of 4 February 2024 https://www.equityreleasesupermarket.com/compare-deals/retirement-interest-only 
• End of term age limit – this refers to the age by which the borrower has repaid their mortgage. 

All information correct at time of publication

Owning a home in your later years can bring security. However, as retirement approaches, it can get tricky. Often, mortgage options are limited. Many high street lenders are now unwilling to allow a mortgage to extend beyond normal retirement date. Even though many people now plan to work to age 70 and beyond or will have regular reliable pension income.

But there are products out there to help.  

Here at Perenna, age is just a number. That’s why we don’t apply age limits to our products. Instead, we assess mortgage applications on property value and whether the monthly payments are affordable (maximum loan to value limits may apply).  

And for those borrowers looking to keep their monthly payments down, we can offer interest-only options. Let’s explore… 

Interest-only options allow people to borrow against their home but only pay back the interest each month. The original amount borrowed is still due at the end of the agreed term. For those people looking for an option in later life, there’s retirement interest-only (RIO) products too.

What’s the difference between a RIO and regular interest-only mortgage?  

The truth is, they can seem similar. That’s because, for both, you only need to repay the interest each month. However, with a standard interest-only product, you will need to show how you’ll pay off the loan at the end of the mortgage term. This could be through savings or selling your home for example.

With a RIO product, you don’t need to repay your loan until you, or if it’s a joint mortgage, the last remaining one of you dies or decides to live elsewhere long term. For example, if you move into a residential home.

For a Perenna RIO mortgage, the other key difference is that they are only available to borrowers over the age of 50.

Why choose a later life mortgage? 

There are many reasons people may want a mortgage into retirement. It could be to support their lifestyle or to pay for home improvements. It could lower monthly payments. Or for some, it may allow them to stay in the home they love.  

Looking at a RIO option can help with all of these things. It can also lower those monthly repayments. And this can help to remove that worry and focus on enjoying life.  

How can Perenna help? 

We want to help homeowners make the most of their retirement. That’s why we’re proud to provide options to those who are looking for mortgages whilst they’re enjoying their golden years.  

A Perenna RIO mortgage is available to borrowers over the age of 50, up to 60% loan to value. 

Want to find out more?  

Our mortgages are currently available through mortgage brokers only. So, if you’d like some mortgage advice, that’s no problem. We can help find someone near you. They’ll provide tailored advice based on your mortgage needs. Plus, they’ll know all about our mortgages, so can answer any questions you may have. 

Find a broker 

You could lose your home if you don’t keep up your mortgage repayments.

Correct at time of publishing.