Remortgaging aged 54 & 56, how long a term will we get.

easy

Briefly,
we owe 82K on an interest - only mortgage, currently just on variable rate, with 7 or 8 years to run.
I'd like to switch to a fixed rate repayment, but obviously that would hit monthly payments quite significantly.
So I though about increasing the term, ideally to 15 years, 12 at a push.
What hope do we have of getting a longer term, given our ages - we are both in work which we would anticipate continuing until our full retirement ages.

csgohan4

do you have a payment vehicle to pay the rest off at the end of the term?

danm

lenders will generally lend until the point in time where you tell them you plan to retire.


They are relying on you to be truthful - obviously if you say something silly they will call you out

Darkstar

I am in a very similar situation. Interest only mortgage and in my 50's. I am in the process of remortgaging but changing to a repayment that ended when I retire would be a huge payment shock. Instead I have approval to run till my 74th Birthday.

You will need proof of how you will finance retirement which is getting harder as they insist on using the assumption you will buy an annuity. Either way my DC pot is big enough to demonstrate if I was stark raving bonkers and bought a annuity at 41:1 then I could still afford the repayments.

I don't plan to let the mortgage run that long as part of the 25% tax free from my DC pot will pay of the remaining balance when I finally do retire. Which was the plan for the interest only I did have but now I just don't qualify for the few remaining interest only options left.

A simple test is to use one of the mortgage affordability calculators for the amount you want to borrow, 82K, over the term you would like, till your 75th birthday, but only use your provable retirement income from DB and/or DC forecasts and remember to including the state pension.