Should older people be able to take out a mortgage?

I assumed Which?’s trading loss on mortgages would be offset by trading gains through other channels [publications etc].

I rather thought the monthly publications were part of my “subscription” as these are not on public sale. I think there is confusion (in my mind anyway) about what being a member is – or was – and whether the charity is effectively defunct and it has become a trading organisation. This criticism was leveled at Age UK.

However sorry we are off topic. Mortgages are now no more than ordinary loans, are they not, but at much more attractive rates of interest,for much larger amounts of money and for much longer terms normally because they are backed by solid collateral (unless we have another crisis). We don’t get tax relief like I did when I bought my first house, except indirectly if you are a landlord. The big problem has always been the increasing size of the loans on offer, compared to income, which has directly fueled house price growth. It is a vicious circle – if you restrict loan to earnings even more and reduce prices somewhat, it will still be difficult to get on the ladder as the deposit will still be large in monetary terms.

I’d like some examples of the really old people who want mortgages. Are they selling and trading up – but have a large equity in the property so are a safe bet. Are they buying for the first time – presumably either with a big deposit and/or a big pension, so a safe bet. Or are there other more tricky cases?

I think the circumstances at this point in the mortgage market come in many different shapes and forms. The situations I have read about include people who have considerable equity in their present house but not enough to buy a property [even a smaller one] outright in their chosen relocation area so they can be nearer to their family or to the services and facilities they might need in later life. Others have returned from living abroad and want to buy a property, some just want to “escape to the country” so they have more space in which to pursue their interests, and others might be starting a new life after death or divorce. There will also be people coming out of occupational accommodation at the end of their careers, and people who have been in rented accommodation and have not managed to build up sufficient funds to buy outright. For many the mortgage might not be large, or long term, and will be required to carry out modernisation or improvements to their existing home. My guess would be that most of the people seeking these loans will be experienced and responsible and in most cases a good risk for the lender. The lenders will no doubt protect their own position quite diligently and the terms and conditions might not be particularly favourable compared to those offered to younger or more conventional buyers.

In referring to the trading gains from publications, Malcolm, I was thinking of the books that are sold by Which? that anyone can buy. Some have been going for years but perhaps they are not profitable.

Thanks John 🙂

It looks like he has bought a dwelling for multiple occupancy. I wonder if he has registered that with the LA and installed smoke alarms in every room?

I must have missed these adverts. Is Officer Dibble not around to enforce the law?

Halifax . . . Alley Cats . . . it has a certain poetrical potential perhaps.

I hope older people applying for home loans will give very careful consideration to those contingencies, Katherine. I assume that the lending organisations will insist on payment protection insurance [without any mis-selling, of course].

I agree Debbie. The other consideration in the lender’s assessment is the loan-to-value ratio and I would expect in most cases older borrowers’s assets would be in a better position than many of the risks that banks and building societies take on with younger borrowers. People should also consider insurance companies as a source of home loans, usually linked to life assurance but sometimes more attractive than the obvious high street offerings.