Just because you have reached retirement age it does not mean that you cannot still get a mortgage, but it does mean lenders will be a lot stricter with you when it comes to how much you can borrow.
It’s all about risk when it comes to obtaining a mortgage and unfortunately the older you get and the less time you have to pay back the mortgage the riskier an investment you become.
These few questions should help you assess whether you will be eligible for a mortgage.
1) Why Do You Need The Mortgage?
A) I want the mortgage to pay for a buy-to-let property to fund my retirement
B) I want to buy the house for a family member
C) I want to upgrade my property
2) Are You In Full Time Employment?
A) No, I’m not in full-time employment but do have a regular income coming in
B) I work part-time
C) I am no longer employed and living on my pension
3) How Do You Intend To Pay Back The Mortgage?
A) I have savings/expect a significant windfall in the next few years
B) I intend to repay it by using savings/odd job work
C) I have no means at the moment of paying back the mortgage
4) Do you have somebody Who Could Act As A Guarantor?
A) My family have agreed to act as guarantors
B) I have not spoken to anyone about this but I think there is
C) I have nobody to act as a guarantor
5) Do You Own Any Other Property?
A) Yes, I have a few properties
B) I own one property
C) I own no other properties
Mostly A – A Good Investment
From your answers it seems like a mortgage lender would view you as a good investment. The main question any mortgage lender will ask is why you need to get a mortgage at the age of 60. A lot will depend on how much you want to borrow. 7
It is very unlikely that a mortgage lender will offer you above 60% of the property’s value, simply because you might not have enough time to pay this back.
When assessing whether you can get a mortgage a lender will look at affordability and how you’re going to pay it back. If you have other properties already and have paid off the mortgage on these this will work in your favour as a lender knows you can always sell one of these to pay for the mortgage.
If you have a regular income coming in from either a pension or savings this will also work in your favour.
A lot of mortgage lenders will also request that somebody in their 60s will have somebody to act as a guarantor for the mortgage and they might want to carry out checks on the person, but from your answers you stand a good chance of obtaining a mortgage.
Mostly B – Affordability Might Be An Issue
It does not sound like you are still 100% sure as to how you are going to pay back the mortgage. In order to present yourself as a desirable borrower you will need to make sure you have a set budget and set income coming in and an emergency back-up plan in case you start to struggle with your payments.
If you plan to use some of your savings to pay off the mortgage it might be a better idea to use this as a larger deposit for the property and reduce your mortgage payments. If you are buying the property to rent out or for a family member you might want to ask them to come in on the investment and share the burden.
Mostly C –A Risky Investment
Unfortunately from your answers a mortgage lender would not be willing to offer you a mortgage. If it is not essential that you buy a property or upgrade you should maybe consider holding off getting a mortgage.
If you have nobody to act as a guarantor and no means of paying back a mortgage your chances of being approved are close to zero. It might be an idea to enjoy your retirement in rented accommodation instead.
Paying back a mortgage when you are retired is no easy task, but it is possible. A lender will not lend to you unless they deem you to be a good investment. Each lender will have different criteria when it comes to lending to people in retirement. It is worth visiting a financial adviser to look at your options, an adviser will be able to compare all the different lending criteria of mortgage lenders and hopefully find you the best deal.
Hi actually my dad is almost 60 he is full time and quite good savings I want to buy a home with him and my husband is self empmoyed we have 20% deposit kindly suggest us which mortgage advisor can do for us any thing bcoz we are not getting reasonable mortgage plz help us regards shamaela
Sorry but we cannot recommend specific providers or products on this site. Ask around locally for a good indepednet financial advisor.
PropertyInRetirement - 19-Apr-17 @ 10:58 AM
Hi actually my dad is almost 60 he is full time and quite good savings i want to buy a home with him and my husband is self empmoyed we have 20% deposit kindly suggest us which mortgage advisor can do for us any thing bcoz we are not getting reasonable mortgage plz help us regards shamaela
Shami - 16-Apr-17 @ 4:05 PM
I am 65 next year I have a mortgage with santandare for 40k the property is worth 115k to 125k I need to pay this of as I have no insurance to cover the interest only mortgage I have is there a solution
scotsman - 17-Nov-16 @ 6:07 PM
jack - Your Question:
I am looking to borrow on interest only 220000 on a purchase price 319000 I will put 100000 on as a deposit. I am selling a buy to let for 288000.I have residential house 360000 I live in.I work for social services and have done so for 33 years lived in my residential property 37 years.I have savings to back me up should things go wrong and I would like the mortgage to be on longest time possible on interest only to start with.I am foster carers and shared lives I earn 64 plus a year and get pensions from my late husband about 6000 a year.I not sure what to have 2nd residential mortgage or buy to let has I am at this stage not sure who will live in property but its a really good buy investment for me. Please can you help. Many Thanks Mrs Powell
We do not lend here unfortunately; this website is merely for advice and guidance. You might want to consider asking a professional financial adviser.
PropertyInRetirement - 4-Jul-16 @ 1:53 PM
I am lookingto borrow on interest only 220000 on a purchaseprice 319000 I will put 100000 on as a deposit. I am selling a buy to let for 288000.
I have residential house 360000 I live in.
I work for social services and have done so for 33 years lived in my residential property 37 years.
I have savings to back me up should things go wrong and I would like the mortgage to be on longest time possible on interest only to start with.
I am foster carers and shared lives I earn 64 plus a year and get pensions from my late husbandabout 6000 a year.
Inot sure what tohave 2nd residential mortgage or buy to let has I am at this stage not sure who will live in property butits a really good buy investment for me. Please can you help. Many Thanks Mrs Powell
jack - 1-Jul-16 @ 5:04 PM
I have inherited a50% share of a flat belonging to my late mother. My sister would like to sell and use the money for other projects, but perhaps I should get a mortgage to pay her half. The other problem is a short lease, only 45 years left this I reckon could cost 40 to 50k. The flat needs another 10k on improvements as well. The flat is in Reigate, in good condition it would make 300k in its present state 200k to a cash buyer . I'm 60 with a full time job and a small mortgage still running. Any ideas?
Bobby boy - 4-May-15 @ 9:31 PM
Myself and wife have been living in Spain for the passed twenty years, and we would like to relocate back to the UK we have been looking at property's to rent but because we have animals (one dog four cats).
My wife is sixty three and i am sixty one, the house we rent in Spain is about to be sold so we are thinking it mite be time to return to the UK .
I have been given the chance to start work with a friend ( permanent) self employed so will have an income as well as the wife's pensionwe would be looking for a property somewhere in country but not on estates
Regards Paul Owe-Griffiths.