The fall in the equity withdrawal figures is blamed on the global credit crunch which has seem lenders tightening their criteria for lending and as such fewer home owners are able to borrow money to pay for home improvements, pay off debt or simply to provide a little relief as disposable incomes are squeezed.

Traditional equity release for people over 50 also saw a slight decrease, however a representative from Safe Home Income Plans (SHIP) said in a quote in the Independent business magazine that this decrease was due mostly in part on the collapse of Northern Rock which held quite a sizeable stake in the equity release market.

SHIP is the trade association hat represents lenders offering equity release schemes for older people.

Northern Rock’s portfolio accounts for a great deal of the UK mortgage market, however after being embroiled in the global credit crunch problems has meant they were unable to borrow money to fund their business practices, hence the bail out by the UK’s main bank.

The portfolio of lifetime mortgages prior to the sale to JP Morgan is said to make up approximately two percent of Northern Rock’s assets. At the time of writiing, Northern Rock offer three equity release products

• Standard Lifetime Mortgage
• Cash Plus Lifetime Mortgage
• Protected Equity Lifetime Mortgage

Chief Executive Andy Kuipers is happy about the equity release portfolio sale. He said “It illustrates the quality of our assets, which has enabled us to achieve a sale at a premium despite continuing difficult financial markets“.