Mortgages for over 40s – cause for concern locally?

The UK press recently reported that the over 40’s are finding it increasingly difficult to obtain mortgages.

The BBC led with “Over 40s being ‘frozen out’ of home loans”, the Daily Mail stated “Over 40? Then you CAN’T have a mortgage” and the Telegraph wrote “Forty-somethings too old to get a mortgage”.

The worrying headlines all stemmed from a report by the Intermediary Mortgage Lenders Association (IMLA) which found that many lenders have imposed lower maximum age limits on mortgages because of uncertainty over the rules. The report stated that the strict new affordability checks meant that customers aged over 40 looking for a standard 25-year mortgage were finding their options severely limited because they would be borrowing beyond the normal retirement age of 65.

So is there cause for concern locally? Swoffers asked Pierre Blampied, Managing Director of SPF Private Clients who told us, “On Guernsey we certainly don’t have this issue. Lenders currently work to a retirement age of 67 and if the applicants are able to show they have good pension income after retirement then a mortgage to aged 75 could even be achievable. A self-employed individual can on occasion also borrow to age 75.

In addition, we are able to look at a longer time period for couples if the younger partner is a significantly greater earner than the older one. Here, a longer mortgage based on the younger persons retirement age can sometimes be obtained.”

He adds, “The Mortgage Market Review that caused these issues in the UK pleasingly has only filtered down into our mortgage market via two lenders so there’s no cause for alarm. The best course of action if you’re looking to buy, is still to consult a professional who will find a mortgage that’s right for your circumstances.”

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