With many standard interest only mortgages due to reach maturity in 2023, it is expected that remortgages for over 60s will be in demand. However, it is not as easy as remortgaging in your thirties or forties, especially with affordability checks becoming stricter since the Mortgage Market Review (MMR).
High street lenders are looking at whether borrowers can continue to afford payments even after they have reached retirement age. This includes assessing whether private or state pensions will cover the repayments, savings, investments and dividend income. It is also necessary to check credit scores to ensure that any mistakes can be corrected.
Maximizing Your Home’s Value: A Guide to Remortgages for Over 60s
There are still lenders that offer remortgages for over 60s with loan to value ratios up to 70% and it is thought that more will join them in 2023. The higher the equity in your property, the lower the loan to value required. It is worth speaking to an independent financial adviser to find out more.
There are also other ways to borrow money after the age of 60, including equity release mortgages and home reversion plans. These options are not suitable for everyone, but can be a good option if you cannot afford repayments on a new mortgage. With equity release plans, the loan is not paid back until you pass away and your estate receives either a percentage of the home’s value or a cash lump sum. A lifetime mortgage is a similar option that does not require any monthly repayments and the debt is only repaid when you sell your home.