Mortgage Advice for Police Officers and Retired Police

The 1987 Police Pension Scheme applied to officers who joined before April 2006. It provides a two-thirds of pensionable pay pension after 30 years’ service, payable immediately on retirement from the service regardless of age. Members can commute part of the pension for a tax-free lump sum. The 1987 scheme is considered exceptionally generous by modern pension standards, reflecting historic recognition of the nature of police work.

The 2006 Police Pension Scheme applies to officers who joined between April 2006 and March 2015, and to those who transferred from the 1987 scheme. Normal pension age is 55, and members can take a lump sum by commutation. The 2015 Police Pension Scheme applies to service from April 2015 onwards and has a career average structure with normal pension age linked to the state pension age.

The McCloud remedy affected service between April 2015 and March 2022, during which younger officers had been placed in the 2015 scheme while older officers were kept in the 1987 or 2006 schemes. The remedy gives affected officers choice over how that period’s service is treated. This is relevant to mortgage applications because the remedy may update the pension figures the officer is entitled to, particularly for those approaching retirement.

Ill-health and injury awards are a specific feature of police pensions. Officers medically retired on ill-health grounds receive an enhanced pension that reflects the service they would have given had they not been retired. Officers injured in the line of duty may qualify for an injury award, which is paid on top of the main pension and provides additional income. Both are treated as high-quality defined benefit income for mortgage affordability.

Police pensions are generally treated by mortgage lenders as strong defined benefit income: payable for life, inflation-linked, backed by government funding. Lender appetite for officers drawing police pension is generally positive.

Pension advice on police pension decisions (commutation, timing of retirement, handling of multiple scheme periods) is outside our regulated scope. We signpost to qualified pension advisers who specialise in police pensions for these conversations. Our role is the mortgage element.

The Process

Your first conversation is a relaxed discussion about your service, your scheme, and the mortgage you need. There is no cost or obligation.

We complete a full fact-find and ask for supporting pension documentation (pension statement, commutation details if relevant, ill-health or injury award details if applicable). We research the market and come back with a written recommendation.

Every case is different. A long-service 1987 scheme retiree is a different case from a recent retiree with mixed scheme service, and our advice reflects those differences.