As a society, we’re changing. We’re living longer. We’re more active in later life. And, though not always through choice, we’re waiting longer to buy properties. And the mortgage market is finally starting to reflect that.
For many years mortgage lenders required borrowers to have paid off their mortgages by the age of 75 at the latest. This meant that borrowers in their 50s seeking a mortgage with a term of 25 years could struggle.
However, in recent years mortgage lenders have started to move with the times, recognising the changing face of our society and adjusting their criteria accordingly.
While some of the bigger lenders and high street banks have yet to address the issue, a number of smaller lenders have changed their age limits in recent months with building societies leading the way. It’s now possible to take out a mortgage with a maximum age limit of 85 years subject to affordabilty.
This is a welcome move. Affordability is obviously key when it comes to borrowing. Nobody wants to see a return to the days of reckless lending that we saw in the run up to the market crash. However, affordability is not defined by age anymore. An income from employment is just one form of income. By assessing a client’s circumstances and making a decision based on their affordability rather than using a blanket age limit lenders can ensure those borrowers who are able to repay a mortgage are not unfairly refused one.
If you’re concerned about borrowing into retirement and would like to know what options are available to you call in and see us at We Know Mortgages for a chat.