Mortgage or alternative options for over 50 y.o.

[Deleted User]

Hello everyone,

What are the chances of getting a mortgage, if you are 50+ y.o.? What are the alternatives to a mortgage?

Any useful links/information is highly appreciate.

Cheers!

freesha

If she is in a position to 'maybe' afford to buy, I'd imagine she will be very low on the list for social housing.

dimbo61

If you have a good deposit and live in a cheap area she may well be able to get a mortgage and buy a suitable property but it all depends on income, savings and credit history.

AdrianC

Cahgpuc said:

If my mom (52 y.o.), with her income, which is slightly less than the UK average, would like to purchase a property in the UK, what are her realistic chances to get a mortgage? What age is the latest to apply for mortgage?

Probably fairly low chances. There is no absolute maximum, but I suspect her pension provision is not generous - and state retirement age for her will be 67, just 15 years time. How substantial are her savings? What part of the country is she in?

And apart from mortgages, are there any alternative options in her circumstances?

Private rental. Which, I suspect, is what she's doing currently.

Can she apply for some kind of social housing, if possible?

Of course she can apply. That doesn't mean she'll get. A middle-aged single woman with no resident dependents, no disabilities, and a reasonable earned income is not a high priority.

Mutton_Geoff

Many lenders offer mortgages up to age 70 so someone age 69 could still get a mortgage albeit on a one year term. I remortgaged in my 60s but the LTV and earnings multiple was low. If her deposit is low and normal retirement age less than 70, then lending multiples may be low after stress testing, especially in this Covid 19 world.

cattie

I was 48 when I first took on a mortgage completely my own. I earned a pretty average salary for London at the time.  I had a decent deposit & the LTV was low. The lender proposed I have an 18yr repayment term., which I was happy with & I actually cleared my mortage within 12yrs by regularly overpaying. This was some years ago now & with job security not something to rely on currently, lenders have probably changed their criteria

Nick_C

Santander offer mortgages to age 75.  Nationwide offer mortgages to age 85.  But they would want to be satisfied that an applicant would be able to afford the mortgage beyond normal retirement age.

You mum has 16 years to normal retirement age.  It's not out of the questions.  A mortgage taken out today might be cheaper than rent in 16 years time.

AlexMac

Another vote for Nationwide.  We were saving like mad to repay our "Interest Only" mortgage next year, as it was originally only offered til we approached 74 or 75...  but then they alerted us to lifetime mortgages and loans in later life.

OK, we now have a very good loan-to-value ratio, maybe the good deals we can access are only for existing customers, and maybe new applicants won't get "IO" now, but ... worth a chat with one of the few remaining mutuals who seem to genuinely care about customers?

AdrianC

Cahgpuc said:

Which % of a property price is considered to be "good" for the first deposit? 20%?

AdrianC said:

Probably fairly low chances. There is no absolute maximum, but I suspect her pension provision is not generous - and state retirement age for her will be 67, just 15 years time. How substantial are her savings? What part of the country is she in?

Her current savings are £15-20k, I believe. She is in Northampton. It's not the most expensive area, so I guess there are some realistic chances to buy something there... Would you agree?

She'll be lucky to get more than 85% LtV mortgage at the moment.
So £20k equity = £130k purchase price = £110k mortgage.
Assuming £25k income (from "slightly less than UK average"), that's 4.5x income.

Plenty of perfectly pleasant looking 1-2 bed flats in N'pton for ~£130k.

It may be doable. She needs to speak to a broker.