If you are one of the many UK homeowners at retirement age and thinking of applying for a new mortgage, you will be forgiven for assuming that you have little chance of obtaining an affordable offer. . Until quite recently, lenders viewed the over 60s as high risk borrowers which meant options were historically very limited.
However, many banks and building societies have now started to recognise that the general population live longer (and work !) longer and have started to be more flexible by offering a wider range of products to older borrowers.
That said, getting a mortgage when you are of a certain age is still more complicated than for younger applicants. Therefore before you embark on the process, you may like to read our helpful 5 step guide to give you the best possible start.
Step 1: Do your homework – what size mortgage do you need?
Look at how much you want to borrow and what loan-to-value (LTV) you will need. This is likely to be based on the value of equity in your own home, unless you have funds elsewhere for a deposit.
Step 2: Consider your options – what mortgage products are out there for older borrowers?
Read up on the different products available for older borrowers. A regular income is still a necessity for a classic mortgage, so if you don’t have this, you may need to consider options such as equity release e, a lifetime mortgage, home income plan or home reversion plan. .
Step 3: Dig out your mortgage documentation – prove your income
By this we mean pay slips or tax returns, pension statements, cash savings account statements, investment portfolio statements, buy-to-let tenancy agreements and healthy monthly bank statements, amongst others. If you have a reasonable level of assets outside of your home, then you may be considered by some of the private banks, who are traditionally more flexible on income assessment for individuals with complicated income scenarios.
Step 4: Pick up the phone – speak to an independent mortgage adviser
Once armed with a solid idea of what you want and what you can demonstrate on paper, it’s time to make that call to the expert, who will be able to discuss your requirements and source the most suitable product from their vast panel of reputable lenders. Brokers have to hand the age limits, income minimums, product varieties and documentation requirements of hundreds of lenders, so let them do the hard work for you and whittle down the selection to the top few who offer you the highest chances of a successful application.
Step 5: Game on – apply for a mortgage product that best suits your situation
If you are over 60 and interested in speaking with an independent adviser about your mortgage options, give Springtide Capital a call today on020 3040 4400. .