If you are 65 or over and looking to take out a mortgage, it is important to make it clear that it is still possible. So, whether you are looking to purchase property for the first time, free up some money to better enjoy those later years or just desire to take some strain off your monthly outgoings, don’t give up hope. Instead, keep reading.
Banks and Older Borrowers
Because banks are often one of the first mortgage providers and so make up some of the most popular mortgage providers in the UK, they can afford to be very selective about whom they lend to. Hence, most major banks, whilst able to afford to lend to those considered to present more of a risk, are usually reluctant to take risks on older borrowers.
Financial risks aside, banks are also acutely aware of the damage ‘bad press’ can cause a business. After all, banks have had their fair share of bad press in recent years. So, the prospect (however small) of having to repossess the home of a pensioner is often enough to mean that many banks won’t even entertain offering a mortgage to an older borrower. If you are over 65 (or even 55) you may already experienced this reality. But then, what can you do?
Don’t Rule Out the Banks
In 2015 people are living, working and earning longer than ever. As such even the banks have had to alter and adjust their attitudes and thinking. That means, even those who were ‘put off’ at 55 by being told the likelihood of securing a mortgage was slim may even discover at 65 that they can still do exactly that. The fact is, times are ever changing.
What matters as an older borrower in 2015 and how an older borrower can secure a mortgage is a matter of being able to establish and prove the following.
Establish the Size of the Mortgage or Re-mortgage You Require
It is likely, even today, a bank might be hesitant or unsure about lending to you, or even entertaining the thought. Consequently, it is imperative that you are not hesitant or unsure, but instead know exactly what you need. Presenting a chosen mortgage supplier with concrete and accurate figures inspires confidence. Further, it enables a mortgage supplier to calculate the risks or potential risks of approving your mortgage application. So, do not give a supplier any excuse to say no on the basis of your age before considering you on the basis of being an individual.
To help establish the size mortgage you may need, the BBC website features a useful mortgage calculator tool, you may find useful when making preliminary assessments, including estimating interest rates and monthly repayments.
Prove the Banks Wrong
Banks are likely to be sceptical as to how likely it is an older borrower will pay them back in the long term. So, if it is a younger person’s task to prove themselves as a viable and good investment to a bank, it is an older borrower’s task to prove the banks wrong for thinking that they may not be a sensible investment.
Most simply, an older borrower must be doubly organised and clear about their income, amounts and financial situation. That is, if you are still earning, show it and show it clearly. As well, make sure to include in your proof of income all of your monthly incomings, including any finances that comes from pensions, insurance policies and / or any investments you might have.
Consider a Guarantor Mortgage
To further assure a lender, seek to find a guarantor. For many older borrowers, this may prove an uncomfortable option, but for a lender who is sure that they are able to manage a mortgage in later life, it shouldn’t be. Seeking a guarantor at any age is a means of instantly increasing one’s potential of successfully attaining a mortgage.
For more information, the Mortgages-Remortgages website explains how guarantor mortgages work.
Tailor Your Search
Older borrowers can enhance their chance of having their mortgage application accepted by tailoring their search towards lenders who favour more matured borrowers. That said, finding such providers, whilst not impossible, can prove time consuming and difficult. Hence, the best advice is to seek expert advice when searching for a mortgage as an older borrower by contacting the likes of ourselves.
Reputable mortgage brokers, offer unbiased and professional advice on a case-to-case basis and without charging an initial broker fee, guarantying that the service you receive from them is the best advice at the best price – whatever your age or circumstances. So, if you are an older borrower and unsure where to turn, a mortgage advisory service may prove your best next step and are well worth speaking to before taking any action which could potentially and otherwise affect your credit rating or impact upon your chances to have a mortgage application accepted.
Further Information and Advice
Back in 2013, This is Money published an article titled ‘How to Beat Lenders’ Age Discrimination’. The article featured a ‘six key challenge’ which even in 2015 remains full of relevant information and advice on approaching mortgage lenders as an older borrower. Hence, for further information and ideas as to getting a mortgage application approved in later life, you might want to the This is Money website.