Older Borrowers

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Older Borrower Mortgages

Our MD Daniel Condren talks about Older Borrower mortgages. Listen below 

Older Borrower Mortgages

Daniel Condren answers your questions on older borrowers.

How do I better my chances of securing a mortgage as an older borrower?

You’ll be surprised to know that a lot of people think that they’re an older borrower when they hit forty or forty five or fifty, which is not the case at all. There’s definitely a lot of options for older borrowers. There’s no real difference between an older person, compared to a younger person, as long as you’re between the ages of eighteen through to eighty.

At eighty, there will be lending options available. Older borrowers still have to go through the same options of affordability and assessment, just double check and speak to an experienced unrestricted broker that’s got access to all the lenders in the UK market.

Can you get a mortgage after you retire?

Most people’s income typically drops when you retire, so lenders have to look at whether the mortgage is going to be affordable. You need to be able to demonstrate that you can still live and afford the repayments after you retire. If you’ve got an adequate pension, there’s no reason why that should stop you from getting a mortgage. But again. Rather than struggle, it’s good to know your options, so speak to your broker to see what options are available for.

Should you use Equity Release?

Equity Release was a bit of a scary term when it comes to older borrowers, but it’s gone through an overhaul whereby the FCA (Financial Conduct Authority) have regulated it. You can have your equity rolled up within your mortgage, so that you don’t make payments, which means your equity reduces over time.

For an older customer that may be vulnerable, or doesn’t have family that relies on them, Equity Release can be an option, but it’s not always the right one. There are many other options available, Interest-only, Retirement Interest-only or different products where you can service the interest. Equity Release options are only suitable for certain customers, so always check whether it’s right for you.

Typically older borrowers are private with their affairs, and might not want to share it with family. What we’ve found is that you need to share and make sure that you’re still aware of what the equity release market is and the full implications of taking a mortgage for you and your family.

What is the age limit for getting a mortgage?

It varies from lender to lender, so if you just went to one high street bank or you are bound by their individual age limitations. When you go to a broker, there are multiple lenders, each with a different policy of maximum ages, ranging from seventy with some high street lenders, to seventy-five with others.

It might even be possible to go to the edge of eighty or ninety, and some lenders have no age limits.

Can I get a thirty year mortgage at age fifty-five?

If your income is strong enough and your credit rating is not impaired, then there should be no reason why you wouldn’t be able to do that. It comes down to the income that you’re going to have throughout that duration, what pension provisions you’ve got or what age you’re going to retire.

It is very job specific as well, a builder or tradesman planning to work until seventy-five might raise questions with the lenders, who may want to look at shortening the term to what’s affordable and plausible.

Can I get a mortgage at sixty?

Yes, it will depend on how long you take that mortgage over, how much equity is in your current property or how much deposit you have. When you’ve had a mortgage a very long time the likelihood is that you will appreciate some equity in that house.

Older borrowers typically think that mortgages are a bad thing, but they’re not if you look at the interest and how much debt is on a mortgage, it’s relatively cheap compared to borrowing more, so you could use equity to save you the interest, or to help you if you’re struggling with bills. Equity in an expensive house with no mortgage can save a lot of struggle, so reach out and speak to a broker to see if they can help.

Why can it be harder to get a mortgage when you are older?

It’s just because affordability typically drops because you’ve retired or taken on part-time work. Lenders just want to check that it is affordable.

Which lenders lend to older borrowers?

Lenders love to compete with each other, so a lender will come out with a Rio product (Retirement Interest-only) and it sparks off competitiveness in the market. It’s mainly building societies that help older borrowers, but any Mortgage Broker should have enough experience to understand which lender to go to.

What type of mortgages can you get as an older borrower?

There might not be as many options available, but there are a few Fixed-rate or Tracker-rate options. There are still plenty of options available, as long as the circumstances are right.


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