Help preparing for forthcoming mortgage application

Will_Do

I have a meeting with my bank's mortgage advisor next week and hoping to get some tips/advice to help me prepare.

Background info:

• I'm 56 later this year and looking for a mortgage that will run beyond retirement (planned retirement age 65 - 67). Ideally I'd like a 20 year mortgage if that's a realistic option. I see plenty of lenders, including the one I'm meeting with this week, advertising mortgages with a max age at end of term of 80 so hopefully I'm not thinking wishfully.
• I am looking to buy a property up to £300k but ideally closer to £270 based on what I see available currently in my target market.
• I have total cash in hand of £200k but don't want to use it all for a deposit - looking at a minimum deposit of £120k and max of £150k, if viable.
• First time buyer.
• Gross salary £70k, no other sources of income, no debts or financial commitments, good credit history, 1 dependent (partner).

I'm confident I should easily satisfy the lending criteria if it wasn't for my age. I assume the biggest hurdle I'll have is them having the assurance that I'll be able to continue paying the mortgage beyond retirement and I want to be confident of that myself. In terms of retirement planning I have:

• Small DB pension currently forecasting slightly over £4000 p.a. from age 60.
• 37 years NI contributions and state pension estimate of £10,300 p.a. from age 67 (confirmed on .gov website).
• DC pension pot currently worth £387,000.
• Continuing DC pension contributions of £14,000 p.a. between employee and employer.
• Resident in Scotland so Scottish income tax rates apply.

Estimating my income in retirement, assuming neutral investment performance versus inflation sees a final DC pot of roughly £550k. Drawing down at a rate of 4% = £22k p.a. which added to my state and DB pensions gives a total annual income in retirement of roughly £36k at today's values before tax. Personally, based on my current and estimated post-retirement living expenses I'm comfortable with that and don't personally have concerns with the level of mortgage I'm looking at. I also still have good scope for increasing my salary and I'm also intending to increase my percentage pension contributions in the future. I'm not expecting that to be factored in by the lender, it just helps support my confidence that I'm not biting off more than I can chew.

So, do you think I'm in reasonable shape or am I being naively optimistic? I could increase the deposit or opt for a shorter term but a £150-180k mortgage over 20 years is my sweet spot. Increasing the deposit by up to £30k and/or reducing the term to 15 years are, I think, acceptable options if I need to flex.

K_S

@will_doIf your intention is to get as long a term as possible (up to 80 for example) while retiring at 70 (or earlier), you may struggle based on the pension numbers in your post.

If you intend to retire at 75/80 and meet your specific lender's criteria for lending beyond 70 (differs across lenders), you *should* have options to borrow to your maximum term with affordability based on your current employed income.

There's nothing at all wrong with going direct but given your requirements, I daresay you would be better served by using a broker to identify the most cost-effective lender that will tick the boxes you need. The MSE guide here can help you find one, including fee-free options.
https://www.moneysavingexpert.com/mortgages/best-mortgages-cashback/#step3

Good luck!

ACG

A lender may go to age 80. But they also need proof of how you can pay the mortgage both now and when you retire. Saying you will clear a lump sum wont work. 

You may need to reduce the term or be prepared to work later.