MSE News: People over 40 'denied mortgages'

Leon_W

I was quite angry as I typed it Mortgage Mark !


I'm just getting meself over to Plenty of Fish as, although she's mid fifties, I would. Don't tell the wife though.

Mortgage_Mark_2

Leon_W wrote: »

I was quite angry as I typed it Mortgage Mark !


I'm just getting meself over to Plenty of Fish as, although she's mid fifties, I would. Don't tell the wife though.

There's a 'Fish Wife' joke there, but I'm not making it just for the halibut...

Dave_Ham

Leon_W wrote: »

I have a couple in their mid fifties. Hardly past it.


They have a very sizeable deposit and are renting at the moment @ £1100 pm .


They would like to buy but are of modest means. A repayment mortgage over 10 years is out of the question as the repayments are deemed "unaffordable" by lenders as the term is short.


My calculated mortgage repayment figure over a slightly longer term is £750 which is £250 less than their rental per month.


I can't help them so they are destined to rent for the rest of their lives. Where is the rent going to come from when they do retire ? Housing benefit ?

I assume the lender pool is restricted for some other reason than just age and you cannot extend the term with a different lender?

amnblog

Leon_W wrote: »

That is such a stupid argument amnblog. How does anyone know what is round the corner ?

I agree with you Leon - it is not my argument.


You have crossed me off your Christmas list when I was only pointing out that some posters on this forum take that view.

Leon_W

You get me wrong amnblog. I was agreeing with you. It was "others" I was disagreeing with.


Still on the Christmas card list.


Edited to add. Sorry Dave. Yes that's the case, I have simplified it somewhat but my point still stands.

James_B.

amnblog wrote: »

According to many of the posters on here it is their own fault for not putting their ducks in order when they were younger Leon.

Not their fault, but definitely their choice, or, if you prefer, as a result of their choices.

As to the fact that it's less than their rent, so what? The bank is not exposed to their ability to pay their rent for the next decade plus, but they would of course be exposed to their ability to service the mortgage. If they don't much fancy the prospects of getting every payment on time, then of course they will often choose not to lend.

I tell you what will be unaffordable in 20 years time. The rent. And who is going to pick up that tab ?

Not the bank, which is the key point that they will be considering.

You seem to want to look at this from the point of view of the customer. You can see that they'd be better off if they borrow, but why are you implying that the bank should take this into consideration?

kingstreet

I've just been to the Post Office and the headline of this thread is screaming from the front of one or the other of the slightly more right-wing organs, the Mail or the Express.

Credibility shot to c**p there then.

It is more difficult to get a mortgage to fit the term from your current age to what a lender might consider your retirement age, but the big issue is the arbitrary way in which a lender gets to decide that.

As an example, this is what Halifax uses (page 15);-

http://www.halifax-intermediaries.co.uk/pdf/Hints-and-Tips-Post-MMR-Guide-for-Keying-Main-Applications.pdf

Then you have another lender which will allow you to have a mortgage to 70 if your payslip shows a pension contribution.

Finally, you have lenders who will offer a longer term as long as you can provide "acceptable" evidence of income in retirement.

It's all another MMR dogs' dinner with lenders deciding what the regulator wants to see and what it doesn't. Principle-based regulation just doesn't work for some issues. We need prescribed rules for all to adhere to...

Thrugelmir

Leon_W wrote: »

My calculated mortgage repayment figure over a slightly longer term is £750 which is £250 less than their rental per month.

With a property comes the responsibility of maintenance and upkeep. Flats have service charges to pay.

People's grasp of what should be basic financial matters astounds me these days.

Interest rates may also rise at some point.

Thrugelmir

mrginge wrote: »

Problem: houses are too expensive
Consequence: less people can get mortgages
Solution: build more houses

Alternatively restrict the amount of credit in the system by progressively tightening down on the banks. Which ultimately will tame house prices.

A combination of affordable lending, restricted income multiples and forcing banks to hold more capital. Where have I heard this recently? :think:

BOE capital restrictions don't kick in until 2019. So there's a long road ahead. Results of BOE stress tests next month. Which may place yet more pressure on LLoyds and RBS to recapitalise further.

Uzume

As there is no longer a 'retirement age', it's unclear what 'beyond' retirement age means in mortgage terms. Retirement is now a choice for most people and many will be working into their 70s or older, so it should make no difference to mortgage companies in respect of length of mortgage for 40+ people. They will still need life insurance to cover the outstanding mortgage and they will still have to undergo the 'affordability' tests. Therefore, if lenders are discriminating in this way, this indicates a lack of understanding regarding recent changes to pensions and retirement, which doesn't reflect well on them!