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Tips for taking out a mortgage around retirement age

Finding a mortgage as you get older can be far more difficult, but you may want to re-mortgage or move to a new home. Although there is no legal limit for applying for a mortgage, lenders do have their own upper age limit.

Usually, a lender will expect the mortgage term to have ended by the time the borrower is between 70 and 85, depending on the lender. This can place restrictions on a person if they apply for a mortgage when they are older, resulting in a shorter mortgage term.

To increase the chance of being accepted for a mortgage if you are approaching retirement, try to make sure that your credit record is impeccable to give you the highest chance of acceptance. As affordability checks are now stricter than ever, check that your income will easily cover the mortgage repayments. A CeMAP qualified mortgage advisor will be able to help with this.

Some lenders are willing to offer you a mortgage which won’t be paid off until you retire, or even approve a mortgage application after retirement. However, you will need to have sufficient evidence that your pension will cover the mortgage repayments. If you haven’t yet reached retirement, you will need to ask your pension provider for the current value of your pension, your expected date of retirement and the expected value of your pension at retirement.

Consider other ways to raise money if you are wanting to re-mortgage, perhaps equity release.

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