Lending into Retirement

After the credit crunch of 2008 lenders tightened criteria, and under the guise of responsible lending, many restricted available mortgage terms to a clients’ retirement age. You may think this is perfectly normal, but we are no longer in a time where the majority of the nation has one job for life and retires at 65.

Largely, for those people still able to approve they could afford a mortgage past their retirement age, this rule felt more like age discrimination.

Thankfully lenders listened and over the years we have seen an increasing number of mortgage products available to people past the retirement age of their current employment.

Of course, lenders do still need to ensure the mortgage will be affordable or at least the plans are plausible. Cases we have been able to place for our customers range from using pension income, property income, or investment income.

Given many pensions are more guaranteed than an income from employment, it makes perfect sense to be able to use this for clients looking to borrow in later life. The policy has now been extended further with some lenders offering no limit on the age of the borrower.

To be clear, this is a standard mortgage assessed using an affordability model based on a client’s income, not an equity release mortgage, which are also great products but entirely different.

Should you be interested in finding out more about either of these products please get in touch with us today. advice@homeofmortgages.co.uk