New mortgage deals create opportunity for next time movers in UK
Recent changes by lenders to raise the maximum age limits for mortgage applications are a sign of a changing culture in the UK.
Changes in policies have been announced by leading lenders including the Halifax and Nationwide who have raised the age limit for mortgages to 80 and 85 respectively.
Linden Homes is advising people to take this as an opportunity to step up the ladder. ‘These new mortgages offering people the chance to lend later in life are ideal for those people in their 40s and 50s who are considering a property move, but may’ve been restricted previously by the length of term they could borrow money for,’ said Tom Nicholson, the firm’s divisional managing director.
‘This is another move by the lenders to drive the market and reflects the changing habits of people renting for longer and moving up into larger homes, later in life. The new mortgage policies work the same as any other monthly mortgage repayment agreement. Providing those applying have an existing pension in place which will cover the cost of the monthly repayments, a mortgage agreement will be drawn up against the usual rigorous criteria for eligibility,’ he explained.
According to Adam Champion, business development director at the New Homes Mortgage Helpline this new type of mortgage product is a sign of the times. ‘People need to see these new mortgage opportunities as a type of financial planning tool and they have their place in the market,’ he said.
‘First time buyers are getting older which over time pushes back the ages of those making the second, third or final move. These new mortgages available open up the market for those looking to make their next move as they approach retirement age for instance,’ he added.
Champion stressed that these products are a positive advance for the housing market to help people make choices as they get older and shouldn’t be confused with old endowment style mortgages.
‘They work just the same as any other monthly repayment mortgage, with the debt being repaid over the term. These products give people the chance to make individual choices and find a financial product that works for them and their own situation. I am sure this will really create a great opportunity for those people looking to upgrade their property to consider the new options that now are available to them,’ he pointed out.
Nicholson believes, however, that people looking to make the next house move may be missing out on securing their dream home to meet their family’s needs if they aren’t aware of what is on offer.
Nicholson believes, however, that people looking to make the next house move may be missing out on securing their dream home to meet their family’s needs if they aren’t aware of what is on offer.
‘People in their 40s, 50s or 60s considering a house move will consult their bank to see how much they can borrow and may be told they aren’t in a position to get that larger home they want. What they may not have considered, is speaking with house builders offering new build homes, where potential can be unlocked with other schemes available,’ he said.
He added that while Help to Buy exists to help younger home buyers, the changes could help secure an upgrade to a spacious family home in an ideal location. ‘We’d encourage people in this position to speak with our advisors to see how we could help make that move a reality,’ he said.
He added that while Help to Buy exists to help younger home buyers, the changes could help secure an upgrade to a spacious family home in an ideal location. ‘We’d encourage people in this position to speak with our advisors to see how we could help make that move a reality,’ he said.
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