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For those reaching their 70s, the idea of getting a mortgage might seem out of reach. The truth is age doesn’t have to be a barrier when it comes to securing a mortgage.
Lenders are becoming more flexible with mortgages for older borrowers, and there are options available. So, if you’re 70 and wondering if a mortgage is still possible, the answer is: yes!
Mortgages For Over 70s
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What Mortgage Options Are Available for Older Borrowers Age 70+?
There are a range of mortgage options for pensioners and those in retirement, along with traditional products. Here are some of the most common choices:
- Lifetime mortgage – This type of mortgage allows you to release some of the equity in your home while still living there. The loan is repaid when the property is sold, often after you pass away or move into long-term care. With no monthly repayments required, it’s an appealing choice for those looking for equity release solutions.
- Retirement interest-only mortgage (RIO) – With a RIO, you only pay the interest on the loan, keeping monthly repayments lower. The balance is typically repaid when the house is sold. It’s a great option for retired mortgage borrowers who want flexibility in their payments.
- Traditional repayment mortgage – Even in retirement at age 70+, a traditional repayment mortgage is an option with enough income. With this type, you make monthly payments that reduce both the interest and the loan amount over time, leading to full ownership.
- Interest-only mortgage for seniors – Some lenders still offer interest-only mortgages to those in their 70s. While you’ll only pay the interest each month, the full balance is due at the end of the term. This could suit those planning to sell their property later or with another repayment strategy in place.
- Bridging finance products – Bridging finance which is often called a bridging loan can provide short-term lending solutions for the over 70s. Examples for use include chain breaking or providing fast finance for a purchase.
An independent mortgage broker that specialises in later-life mortgages and over 70s lending, like us, will be able to recommend the best product for your requirements.
Why Would a 70-Year-Old Need a Mortgage?
There are several reasons why someone in their 70s might still need a mortgage:
- Downsizing – Moving to a smaller, more manageable property may require a mortgage to help cover the purchase. Chain breaking solutions may also be available via bridging finance products.
- Releasing equity – A mortgage for over 70s can be a way to unlock some of the value tied up in your home, providing funds for retirement or other expenses.
- Supporting family – Many people want to help children or grandchildren with education or getting on the property ladder.
- Home improvements – A mortgage could fund home modifications, making your space more comfortable and accessible as you age.
- Divorce or separation – Life changes such as divorce may mean needing a mortgage to secure a new home.
- Paying off an existing mortgage – An interest-only mortgage that is ending soon might require a 70+ year old to explore their mortgage options.
- Complicated situation – Often we find that later-life borrowing situations can be complicated and require a bespoke age 70+ mortgage solution.
What Do Lenders Consider?
With traditional mortgages, lenders are open to lending to older applicants, but there are key factors they will assess. Your income is a primary consideration, so you’ll need to demonstrate that you can manage the repayments. This might include pension income, savings, or other sources of regular income.
Another important factor is the age limit for mortgage approval. While younger borrowers may have 25- or 30-year terms, older borrowers are often offered shorter terms. Lenders need to ensure the mortgage is repaid within a manageable timeframe, typically before reaching 75 to 85 years of age.
With equity release, lenders will consider your health, age, property type, and property condition for lending.
How Does Age Affect Mortgage Approval?
Being 70 or older doesn’t automatically disqualify you from getting a mortgage, though some limitations may apply.
Many lenders have an age limit for mortgages, which typically falls between 75 and 85 by the time the loan is repaid. However, more and more lenders are shifting focus from age to financial health.
If you can prove that your income in retirement is stable, whether through pensions or other savings, you may be in a good position to secure a mortgage.
In fact, late-life mortgage solutions like equity release and retirement mortgages are becoming increasingly common.
Steps to Take
If you’re over 70 and thinking about getting a mortgage, research lenders that specialise in mortgages for older borrowers.
Having a clear understanding of your finances, including pension income and savings, will be important.
Speaking with a mortgage advisor experienced in helping retired borrowers can also help find the right deal.
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The Importance of Advice
Being 70 doesn’t mean your mortgage options are limited. With a growing number of lenders catering to older borrowers, including those offering retirement mortgages and equity release for retirees, you may find the right deal to suit your needs.
Whether you’re looking to downsize, release equity, or explore late-life mortgage options, there are still plenty of possibilities available no matter your age.
