A surge of retired New Zealanders are leveraging their homes to free up cash

Heartland Bank has reported a 20 per cent uptick in reverse mortgage approvals over the past six months.

It's something that allows homeowners to take out a mortgage on their house, which isn't paid back until the property is sold.

Enable Me Managing Director Hannah McQueen says it's concerning.

She says it shows they aren't prepared for retirement - and the question is how long they need to mortgage their home for and what's their plan after.