The Financial Ombudsman Service has ruled against HSBC, in what is the first time an age-related complaint has been upheld.
Nigel Waterson, chairman of The Equity Release Council, said: “This could prove to be a landmark decision, one that paves the way for greater lender acceptance of borrowing in later life. With so many retirees facing financial hardship and life expectancies far longer than before, the current restrictions by some lenders on lending into retirement are outdated and unfair.
“A culmination of interest-only loans maturing, recent pension freedoms and tighter lending criteria have all placed funding in later life centre stage. For many older would-be borrowers the obvious solution is to hand, in the form of equity release. Our sector specialises in loans to the over-55s, and therefore has none of the issues currently plaguing older borrowers.
“Those at or nearing retirement age need options; until the age of 55 homeowners routinely remortgage to boost finances but after that point are increasingly restricted in their access to this – and other – forms of borrowing. For anyone experiencing financial worries we urge them to seek independent financial advice to ensure a thorough understanding of the options available to them, including equity release.”