Hodge has reported a 50% increase in the number of people who are looking to use the mortgage funds for home improvements, while 80% more people who applied for a RIO in 2021 said it was for a family gift.
When applying for a RIO, applicants are asked the reason they are taking the mortgage. This year, Hodge has seen that 50% more people are planning to use the funds for home improvements, compared with the same period in the previous year.
Emma Graham, business development director at Hodge, said: “RIOs continue to be a popular product for our intermediaries’ clients, with more looking on it as a perfect stepping-stone product for those who want to enjoy their later life, rather than taking out an equity release product.
“What is interesting from this data is that more RIO customers are using the funds to improve their homes since the pandemic began. The lockdowns meant that more people were spending time in their homes and understandably looking at ways to improve their surroundings. Equally, a lot of people who are now considering working from home longer-term are looking to invest in a good home office space.
“The increase in the number of people wanting to gift funds to family also seems to be a result of the pandemic – maybe absence and the lack of seeing our family, makes the heart more generous as well as fonder?
“Whatever the reasons, it is encouraging for us to see that the RIO is doing what it is designed for, giving options. It allows customers the benefit of using the value in their property to fund further home improvements, as well as financially help their family and friends.”