Lifetime mortgages offer freedom of the road

New research shows that the thing people most often spend equity released from their homes on is a new car.

12:20 01 September 2004

New research shows that the thing people most often spend equity released from their homes on is a new car.

This is according to Norwich Union Equity Release, who discovered that more than a quarter (28 per cent) of people who take out lifetime mortgages plan to spend some of the money on a new car.

There are currently two million drivers in the UK aged over 70 and the last 30 years has seen a 600 per cent increase in female drivers over 65.

Male drivers aged over 65 increased by 200 per cent compared with a 29 per cent increase in both male and female drivers under the age of 60.

"Having a car is the key to independence for many people," says the director of Norwich Union Personal Finance, Mark Kelly.

"However, buying a new car can be a huge financial burden for older or retired people and we have found that many of our customers use a lifetime mortgage to buy a car that they will be able to enjoy for years."

Mr Kelly added: "Taking out a lifetime mortgage is a big decision to undertake and homeowners must ensure that they feel confident that they will be making the best of their money, however they choose to spend it."

In 2003 alone more than 1.1 billion in equity from older people's homes in the UK.