Lifetime mortgages could get scarcer and more expensive as the Bank of England fears lenders are under-pricing the risk of a fall in house prices.
The Prudential Regulation Authority wants insurers, who typically offer the loans, to check they are not assuming a permanent rise in house prices when assessing the risk of lending.
Equity release mortgages are typically given to older borrowers who can unlock the value of their homes, funding retirement spending with a mortgage which is paid back when they die and the lender recoups the money from the sale of the house.
