Seniors Money acquires €90m lifetime loan book

Irish equity release specialists Seniors Money has acquired a portfolio of lifetime loans valued at €90 million from an undisclosed vendor.

The loan book comprises a tranche of Irish mortgages, 70 per cent of which are secured against properties in Dublin with the remainder secured against homes in other urban areas around Ireland, a spokesman for the company said.

He also confirmed that the portfolio includes a small number of home reversion loans.

Seniors Money, the registered name for Spry Finance, would not confirm who the vendor was but said it was another Irish institution and that the loans were all “in good condition”.

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Seniors Money will continue to manage the loans and “all existing terms and conditions . . . will continue”, the company said in a statement on Tuesday.

Lifetime mortgages, otherwise known as equity release loans, and home reversion loans are two products typically aimed at older homeowners. Once widely available on the Irish market, many lenders stopped offering the products after the property crash.

Spry Finance once had a loan book of close to €250 million in the Irish market, but stopped lending due to a lack of funds. It has re-entered the Irish lifetime mortgages market in recent years after its Irish-based management team bought full control of the Irish and Spanish unit from majority backer Quadrant Private Equity in 2018.

A spokesman confirmed that the mortgage portfolio is not part of Spry Finance’s former lifetime loan book that it has bought back from another vendor.

Depending on the borrowers’ age and the value of the property, lifetime loans allow homeowners to borrow up to 40 per cent of the value of their house without making repayments while they are still alive.

Because of this, interest on the loan is higher than normal mortgage loans and is added to the loan balance, which grows over the lifetime of the loan and can swallow up the value of the property.

However, the company says it the value of the loan will never exceed the value of the property it is secured against.

Home reversion loans, meanwhile, allow borrowers to sell a stake in their home, the value of which the lender will receive from the sale of the property when the borrower moves out or dies.

A spokesperson said the acquisition of the €90 million adds “significant scale” to Seniors Money’s business after its relaunch in 2021.