Finding a suitable mortgage is always a tricky and involving task and, rather than getting easier the older you get, it tends to become even more demanding.
That said, choosing a mortgage doesn’t have to be an uphill struggle. While some lenders are less keen to offer deals to older borrowers, there are options open for people who want to move home or take out a second mortgage. Understand the potential pitfalls and advantages of buying when you’re older before setting out to find a lender.
Understanding how age affects mortgage applications
When it comes to mortgages, banks make their money on the interest they charge on the amount you borrow. If you pay off your mortgage more quickly, banks have less of an opportunity to charge you interest and can therefore sometimes see you as a less reliable or profitable investment. For a basic yet comprehensive guide to some of the most commonly asked questions about mortgages, have a look at this need-to-know list from uSwitch. You should also be aware that many banks do have a maximum age limit on their mortgage deals and some will require you to repay the loan in its entirety before you reach a certain age.
Age is a significant barrier for many potential borrowers, as detailed in this interesting article about mortgage choices for older people by Chiara Cavaglieri in the Independent. The recent global economic difficulties have had far reaching effects and one is a list of stricter rules and regulations surrounding mortgages. Some of these changes are having a negative effect on the willingness of banks to lend to older borrowers, although they certainly haven’t made it impossible.
Mortgage options open to you
Before you apply for a new mortgage, there are some things you should always be aware of. The Citizens Advice Bureau offers an excellent breakdown of everything you need to know before approaching a potential lender. You may also want to consider the services of a mortgage broker, who has extensive knowledge of the kinds of products available and also knows the kind of criteria you need to fill to be eligible for them. Turn to The Guardian for some impartial advice on finding a broker who will work hard to help you get the best deal.
With the help of a broker, it’s possible that you’ll be able to find mortgage offers that are specifically designed to suit your demographic. National Counties Building Society has recently launched one such product – an 8 year fixed rate for borrowers up to 80 – find out more in this report from the Financial Reporter.
At Money.co.uk, spend some time reading a variety of hints and tips for choosing a mortgage when you’re an older borrower. It has a comprehensive collection of information that’s well worth understanding before taking the plunge.
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