The Building Societies Association (BSA) announced that they are reviewing age limits on mortgages as more customers demand longer mortgage terms in order to keep monthly costs down. Older homebuyers may soon find it easier to get a mortgage as many lenders currently insist mortgages are repaid prior to the borrower’s planned retirement dates.
At the same time, increasing life expectancy and factors such as high house prices, student debts and a rise in the age at which couples have children means many people are tending to buy a home later and opt for a longer repayment term.
This is one of a number of recommendations in a report called “Lending into Retirement” launched at a recent BSA event.
This prompted me to review Mortgage Required’s requirements for clients borrowing money beyond their normal state retirement age. In future, all clients will be made aware of their estimated mortgage balances at retirement along with the in depth review of their estimated income in retirement we already carry out. According to statistics from monster.co.uk and gov.org, salaries start to fall way before retirement age, as individuals tend to take up part time or less demanding positions, reducing by about 44% when people actually retire.
People tend not to think about their financial position 20 years from now, instead they focus on the “here and now.” It’s our job as Mortgage Advisers to make sure people are aware of their future commitments and their ability to pay these loans on their pension income and also to review the likelihood of those clients continuing to work.
I am all in favour of Building Societies moving with the times, as long as we as an industry keep one eye on potential trouble down the line!
For more information about Lending into Retirement, speak to a mortgage adviser on 01628 507477 or contact us.
Skipton Building Society launches ‘Delayed Start’ mortgage meaning first time buyers won’t be required to make repayments for the first three months.
According to a survey by Skipton, first time buyers who bought their home in the last five years found that in the first three months of living there, they were spending upwards of £30,000.
5 days ago
If you have recently moved into a property with a garden that requires a little TLC, or you’d like to get on top of your current green space, check out our tips.
8 days ago
High street lender, NatWest, have launched a new product to help first-time buyers purchase a property with assistance from a family member or friend to get them on the property ladder sooner.
‘Buy Now, Pay Later’ (BNPL) schemes, such as ‘Klarna’ are short-term loans that allow shoppers to make a purchase, but delay paying for it for an agreed amount of time.
Klarna is one of the most popular BNPL services with 18 million customers in the UK alone, and offers interest-free payment options which is appealing to shoppers. However, does it affect a mortgage application?
14 days ago
We look at how to get the best Buy to Let mortgage rate, what's in store going forward, and options as a landlord with increasing costs.
23 days ago
Throughout this past week, lenders have continued to reduce their mortgage rates giving borrowers in the UK some welcome news following the change in global tariffs under US President, Donald Trump.
23 days ago
Did you know that buying a house, or relocating is in the top 10 most stressful life events?
Stress of course is an unavoidable part of life and there are many reasons why people experience stress, not just buying a house!
There are lots of effective ways to manage and reduce stress, check out our tips to help you.
With the stamp duty relief ending in England and Northern Ireland, we have listed the top 10 cheapest areas for first-time buyers as published by Rightmove.