over 60 first time buyer??

shamo

Hi all,

hoping someone can help, my parents are approaching retirement(63yrs old) and are now looking to buy their first home having been living in a tied property.

They have £110.000 saved for a deposit with an annual pension income of £12,500. They are hoping to get an interest only mortgage or at least the cheapest way of buying their own home.

My questions: Will they be able to get a mortgage against those figures?

If so how much approx?

Can anyone reccomend a broker/lender?

Any other advice would be greatly appreciated.

beecher2

I think they would need a repayment vehicle in place and I can't see them getting very much in the way of a mortgage with such a low income, and due to their age. What size of mortgage are they hoping for?

shamo

Thanks for the quick reply!

They are looking at properties around £220,000, so would hope to borrow 100,000 ish.

Is this a long shot? Would it help if I were able to act as a guarantor? I'm 35 and home owner in full time employment.

forgot to mention they have a Gross Capital Asset (Lump Sum) £37,000

Thanks

hcb42

they still wouldnt be able to pay £100K mortgage payments though...are you saying you want to pay it for them?

Why interest only?

kingstreet

Talk to an IFA or whole market broker with lifetime/equity release permissions. Halifax has a product called Retirement Home Plan which may suit based on what you're saying.

This is not available direct as it requires specialist advice.

shamo

Does the £37000 lump sum make any difference? How much are they likely to be able to borrow? Cheers

maninthestreet

shamo wrote: »

Does the £37000 lump sum make any difference? How much are they likely to be able to borrow? Cheers

No - it is not income.

shamo

Spoken to a broker and the best they will get is 4.25 multiple of income which is not very much as the annual income is £21000 gross. Is there any other way to borrow more considering they will have 60% deposit and need to borrow 100K.

beecher2

I think they really need to lower their expectations of what they can buy.

maninthestreet

shamo wrote: »

Spoken to a broker and the best they will get is 4.25 multiple of income which is not very much as the annual income is £21000 gross. Is there any other way to borrow more considering they will have 60% deposit and need to borrow 100K.

You previously stated their income was only £12,500, but...

4.25 x £21000 = £89,250.

The size of the deposit is not relevant in relation to the maximum amount that they will be allowed to borrow.

shamo

Its complicated, if he applies for the mortgage now he would still be employed with a salary of 21k. If he were to retire this year (aged 63) he would only recieve £12k per annum pension, upon reaching 65 this would be bumped up by the state pension to 19k

I agree that 100k is prob not going to happen but doing my best to find out the figures for them based on their best outcome.