My Situation - Your Thoughts Please

Saga

I am nearly 50yo, employed, recently out of LTR (never married, no kids). I have always rented, so would be a FTB.

I have a total of about £30K in savings including £8K in a HTB ISA, giving about £25K available for a deposit (plus the £2K HTB ISA bonus) at a good LTV ratio - the rest will have to cover fees etc.

I don't have any dependents and I'm otherwise debt-free (no loans or other finance agreements, CCs paid off in full every month, never touch my O/D facility). AFAIK my credit file is OK, judging from my statutory reports - nothing wrong although I did switch current accounts a couple of months ago from the bank I had been with for 30 years, so this is showing up as hard search.

All the Agreements in Principle (AIPs) I've obtained previously from various banks, building societies and L&C say the maximum LTI ratios they would consider vary between 4 and 4.68, which I understand to be pretty much near maximum post-2008 lending guidelines for outside London. On the surface, it seems I shouldn't have an issue getting a mortgage on my own enough to be able to afford a reasonable house in my desired area (for work reasons).

My dilemma is that because of my age, any mortgage is unlikely to be given past retirement so the maximum term is probably 17 years rather than 25 etc. This means projected monthly mortgage repayments all seem to be around 40% of my income. I recall reading a few years back that lenders were wary of outgoing-to-income ratios (OTIs) greater than 30-35%. If interest rates were to rise after initial fixed period (e.g. if I went for a fixed-rate mortgage) then my OTI would be well over 40% so it seems I have no or little buffer for rate increases.

After months of monitoring listings, I've finally seen a house I would like to buy, but now I'm worried that I will get to the actual mortgage application stage and be refused on grounds of affordability because of the OTI (despite all the AIPs suggesting otherwise) and end up paying broker, lender & conveyancing fees all for nothing when the deal falls through.

So in reality, am I worrying over nothing? Is the likelihood of a mortgage application going through high despite the relative high cost of monthly payments compared to income?

Or at my age should I just give up on the idea of getting a mortgage and just carry on renting and try to do something else with my savings to get a decent return comparable to the housing market? Any ideas?

Thanks in advance!

zagubov

We got a 15-year mortgage when I was past 50, with First Direct, but rules have tightened up since then.

I think this may be a situation where a mortgage broker could point you at a suitable lender.

comeandgo

You will get a mortgage past your 67 birthday. We had one reaching 75 with Nationwide.

Tiglet2

My mortgage was due to end when I am 70, though I have been overpaying for some years now and should have it cleared much earlier.

Doozergirl

My friend got a new mortgage that started when he was 65!

It sounds like a broker is the best place to go.

ethank

Agree - speak with a broker

bouicca21

Speaking as someone who was paying 15% on a mortgage in Thatchertime, I can honestly say that if mortgage rates go up, you just get through it. You budget harder, you cut out unnecessary spending, and if things get really tough you get a lodger.

Crumble2018

I'm 46, my husband 43, and we have just got a 25 year mortgage with Nationwide. A broker will get you something.

Mutton_Geoff

I've just remortgaged (age 61) and my term runs to age 75. The payments are low because I have taken interest only as I fully intend to downsize substantially in the next 2-3 years to coincide with retiring. The loan will be paid off at that time.


If it's your first place, then perhaps you won't have the option to downsize but hopefully a broker can find a lender with an age 75 limit and keep your repayments down for the first few years. As you get further into a mortgage, it becomes easier and as debt is paid down, more of your payment is clearing capital, especially if you are able to make overpayments from bonuses, payrises etc in future years.

Saga

Cheers everyone. I'll contact L&C.

Saga

On the question of buying vs renting, do yo all think it's a good idea at my time of life? I don't plan to change jobs.

And because I've only ever rented I've never had to do any repairs or DIY or more serious work requiring contractors, so my knowledge of how to maintain a property is woefully lacking and, if I'm honest, it's all really quite daunting! I've got dodgy knees so can't see myself going up and down 30-foot ladders to re-paint the roof fascia or clear the guttering!