Remortgages For Over 60s
The current UK age for retirement is 66. However, this will rise in the future. This impacts how easy it is for anyone trying to remortgage over the age of 60 because you have to pass affordability checks to ensure you can afford repayments.
While some pensions will be taken into consideration during eligibility checks, others won’t.
Many lenders will have different rules about the ages they allow for the beginning or end of the term, making remortgaging at an older age more challenging for some.
This article will explore the challenges over 60s face when remortgaging and the solutions available.
Use our online mortgage calculator as a guide for your monthly repayments now
We have access to over 200 lenders in the UK to get you the best ratesWe are expert mortgage brokers
Are Remortgages for Over 60s or Retirees Possible?
Some lenders will allow remortgaging for those over 60s or retirees that can prove they can afford monthly mortgage repayments.
Most lenders do this by checking your current employment or pension type. Most mortgage lenders will typically accept private, company and state pensions.
Pensions that are managed by you, such as SIPP (self-invested personal pensions) and drawdown pensions, might not be accepted, and this should be explored with different lending facilities.
Remortgaging Age Limit Restrictions
The first thing you should understand in regard to age restrictions around remortgaging is that there are no set rules, and each lender will have its own policies.
While this can sometimes make it difficult to check who you may be eligible with, it does mean that there will be options available to those over 60.
Maximum age limit restrictions at the point of application will typically range from 55 to 88.
Other restrictions may look at what age you will be at the end of an agreed mortgage term. These age limit restrictions will typically range from between 70 and 90. In some cases, a mortgage lender will state that the maximum age limit for the end of the agreed term will be your retirement age.
It is also possible to find mortgage lenders that have no specified age limits and rely solely on affordability checks.
Eligibility Rules for Popular Lenders
While all lenders will have their own rules and regulations in terms of mortgage applicants, here are some of the most popular UK lenders’ requirements for reference;
- Barclays – Barclays has an age limit of 70 or your retirement age. Older applicants may be considered if there is sufficient evidence of income. Barclays will not consider SIPP income. However, annuity income is considered.
- Halifax – The Halifax maximum age limit is applied to the end of the mortgage term, where the applicant can’t exceed 80 years of age. SIPP and drawdown pension income won’t be considered.
- HSBC – HSBC will consider drawdown pensions, annuities and SIPP incomes. Age limits differ depending on different mortgage products.
- Nationwide – Nationwide will not consider a drawdown pension, but annuity income is considered. They also have a maximum age limit of 75 years by the time the mortgage term ends.
- Santander – Santander sets a maximum age limit of 69 for applicants. Existing Santander customers that wish to borrow the same amount or less are exempt from this limit. Drawdown pensions, SIPP, and annuity income will all be considered.
- Natwest – Natwest does not consider drawdown pensions but will consider annuity and SIPP income. They set an age limit of 72 for applicants.
- Bath Building Society – Bath Building Society age limits are set at 80 for applications, and they must be paid of by 85.
- Clydesdale Bank – Clydesdale bank requires borrowers to have paid their mortgage by 75.
- Chelsea Building Society – Chelsea Building Society mortgages must be paid off by the time the borrower reaches 80.
- Leeds Building Society – The Leeds Building Society has a maximum age limit of 80 for applications and 85 for the final repayment age.
Mortgage Types for Over 60s
When browsing for a new mortgage, having an idea of the kind of interest rate you are looking for will help to narrow down your search.
The following interest rates will typically be available for those over 60;
Variable Rate – This is an adjustable rate that can go up or down based on the Bank of England base rate and set by the lender.
- Fixed Rate – A fixed rate gives you a definitive interest rate that ensures your monthly payments remain the same.
- Discount Rate – A discount rate is a variable rate set below the lender’s SVR (Standard Variable Rate).
- Tracker Rate – A tracker rate is similar to a variable rate but would normally follow the Bank of England base rate.
- Capped Rate – Capped rate mortgages are the same as variable rate mortgages, but they have a cap to limit how high the interest can rise.
- Stepped Rate – Stepped-rate mortgages begin at a lower rate before moving up to a higher rate at a predetermined date.
Remortgage Alternatives
Remortgaging at an older age can be difficult with the different rules in place by lenders. If this is the case, the following options might be worth considering;
- Retirement Interest-Only Mortgage – This is a mortgage type that sees the borrower only make monthly interest payments, with the loan being paid off when you move into long-term care, sell the house, or die.
- Lifetime Mortgage – Lifetime mortgages allow equity release from their property for older homeowners from 55 years of age and above.
How to Remortgage When Over 60
Now that you understand a bit more about mortgage types, the following advice should help you to remortgage your home if you are over 60.
Speak to Existing Lender
The first step when remortgaging should always be to speak with the lender you have your existing mortgage. This will allow you to listen to their offer and better understand the requirements for remortgaging.
Browse Alternative Lenders and Comparison Sites
After speaking with your existing lender about a new mortgage deal, searching online can also help you understand the market.
Using comparison sites is typically straightforward, and you can enter your details into a remortgage calculator.
The information typically required for a remortgage calculator includes the current property value, the remaining balance on your mortgage, the equity release you require, and the term you want to pay it over.
Not all lenders will be included in comparison sites, and some will offer competitive rates on their own sites. Taking the time to fully investigate your options can help you to find the best deals available.
Speak with a Mortgage Broker
Another excellent way to ensure you get the best deals is by speaking with an experienced mortgage broker.
Here at Loan Corp, we can offer you expert mortgage advice and explore the mortgage market on your behalf to secure the best deals resulting in lower monthly repayments for you.
By carrying out a mortgage market review, reviewing your personal circumstances and working out your retirement income, we are able to provide some of the best mortgage options on the market.
Our expertise and experience will allow us to explore the options most likely to accept applications for your personal circumstances. This can save significant time and effort that you might spend conducting these searches yourself.
We will be able to answer any questions you may have to help give you peace of mind during what can be a stressful time.
Contact Loan Corp Today
If you are over 60 and are considering your remortgage options, we can provide a service that can help to save you a significant amount of money.
Our brokers have decades of experience and have access to over 200 lenders, making it easy to find a range of suitable options that provide competitive interest rates and terms.
With so many options on the market, remortgaging can be difficult. When you take into consideration the requirements for those over 60, it can become a challenging task. Our experienced team has access to state-of-the-art systems to ensure we can get you the best options quickly and easily.
Another significant benefit of using Loan Corp when remortgaging is the expert advice we provide and the ability to ask any questions you may have. This will put your mind at rest and ensure you get the mortgage that suits your needs.
Contact us today by calling 0808 301 9509 or using our handy online contact us form. Simply fill in your name, email address, and contact number before selecting the products you are enquiring about and providing some general background information for us to get started.
We aim to get back to you promptly, and you can expect a response on weekdays between 8 and 5 within 2 hours or 4 hours at weekends and bank holidays.
FAQs
Why is remortgaging more difficult when you are over 60?
The main reason remortgaging can be more difficult for people over 60 is that lenders can consider it a bigger risk depending on your anticipated retirement income.
Even with a private pension, your monthly income may fall, which makes affordability checks more difficult for people to pass.
In some cases, lenders may consider investment income, and homeowners can also consider options that will allow them to release equity from their property.
If you are over 60 and struggling to find suitable mortgage deals, finding an experienced broker like Loan Corp can help you get the information you need and allow you to compare mortgages to find the best option for you.
How can people over 60 improve their chances of getting a mortgage at an older age?
The best way older people can improve their chances with different lenders is by ensuring their personal circumstances show them as low risk.
This can be done by ensuring your credit history is clean, and you will be able to comfortably afford repayments.
This can be done by providing information about investments, current salary, and pensions.
Reducing unnecessary outgoings and paying bills on time will also reflect favourably when you are going through affordability checks.
It is always worth checking your credit report to ensure no mistakes will reflect badly on you. Checking Equifax, Experian, or TransUnion can help you do this.
Using a mortgage broker and having all of your paperwork in order will also help you to secure a new mortgage at an older age. This is because brokers will have the experience to know which lenders to approach and the rules they have in place.
What is Older People’s Shared Ownership?
As well as retirement interest-only mortgages and lifetime mortgages, another option for pensioners is the older people’s shared ownership (OPSO) option.
The OPSO scheme is a government-backed initiative that is available to people that are aged 55 and over.
It allows people to buy a share of between 10 and 75% of a property’s market value. You would then pay rent subsidised on the remaining percentage owned by a Registered Provider or Housing Association.
People that buy the 75% maximum share would not have to pay rent on the remaining percentage.
To be eligible for this scheme, you must be over 55, have an annual household income below £80,000, and be unable to purchase a suitable home without necessary assistance.
Applicants cannot have outstanding credit issues and must sell existing properties.
Final Thoughts
Mortgage options for people over 60 can be more challenging to apply for, and your personal circumstances, pension income, and investments will typically play a large part in your eligibility.
Because there are no set rules for lenders in regard to age limits, it can also be time-consuming trying to find suitable lenders.
Because of this, mortgage brokers like Loan Corp can make things significantly easier by providing valuable mortgage advice.
Mortgage advisors’ and brokers’ knowledge of the market will also give them knowledge of lenders’ maximum age limits, allowing them to target eligible lenders to find the right mortgage deal for your needs.
Contact Loan Corp today for expert advice and discover the best mortgage rates on the market that will help to save you money.