Sir Steve Webb described information given to the Bank of England by the Financial Conduct Authority as “shocking.”
According to the report, over a million new mortgages with expiration dates that are older than the state pension age have been issued in the last three years.
In a worst-case scenario, the former Liberal Democrat MP and current partner at the consulting firm LCP expressed concerns that borrowers would be forced to take out loans against their pension assets in order to pay off their mortgage.
Longer-term mortgages rob people of a time leading up to retirement when they may be mortgage-free and increasing their pension, as Sir Steve recognized potential harm in any event.
The requested Freedom of Information data shows that 91,394 new mortgages, or 42% of all mortgages, had terms that extended over the state pension age in the fourth quarter of 2023.
