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Mortgages for over 70s
Our broker partner Advantage can find the best over 70s mortgage for you.
Can I get a mortgage over 70?
You can still get a standard residential mortgage if you’re 70 or older, however, the term length is likely to be shorter than it is for a younger applicant. No matter your age, mortgage approval rests predominantly on affordability. So if you’ve the means to repay a mortgage, your age alone should not be a barrier to buying property.
With an ageing population and rising home ownership costs, UK mortgage lenders have begun to recognise that people are buying property later in life than they once did. Some lenders have even extended their maximum age at repayment limits as far as 85-100 years old, with a handful not imposing a maximum age limit at all.
From the age of 55 upwards, there are also a range of specialist mortgage products that have been specifically designed for older borrowers. We’ll look at over 70s mortgage options in greater detail throughout this article.
What mortgages are available for over 70s?
Standard residential mortgages
This type of mortgage can either be used to buy a new home, or to remortgage your current one. And there are a range of lenders willing to offer this type of mortgage for the over 70s.
It’s important to note that it can be more costly to take on a mortgage at this age, as you will generally have a shorter term in which to repay the loan. Most lenders impose a maximum age limit at which you'll need to repay the loan in full. This then reduces the length of the terms available to you, although it's not true of every lender.
For example, if the lender’s maximum repayment age is 85 and you are currently 70, you could have up to 15 years to repay the mortgage. So long as you were able to prove that you could afford the repayments for that duration. Bear in mind that the repayments would be higher spread over 15 years than over a typical mortgage term of 25-30 years.
Older people’s shared ownership
If you’re living in England and over the age of 55, the older people’s shared ownership scheme (OPSO) can help those on a lower income to buy a home suited to their needs.
The principle is the same as the standard shared ownership scheme, where you buy between 10-75% of a property, rather than the whole thing, making it more affordable. You then rent the share of your home that you don’t own from the housing association, who retain ownership of that percentage.
Where this differs from the main scheme, however, is that you will never fully own your home as you can only increase ownership up to a total of 75% of the property. However, the benefit is that once you own 75%, you will no longer need to pay rent on the remaining 25% share, meaning you can stay rent and mortgage free until you want to sell your home.
You can read about how to qualify for the OPSO scheme on their website.
Retirement interest-only mortgages
Retirement interest-only mortgages are available to anyone over the age of 55 and makes another great over 70s mortgage option. A retirement interest only mortgage (or RIO) means only the interest is payable, making the repayments much smaller. This type of mortgage can be helpful for older applicants who are unable to qualify for a standard residential mortgage due to insufficient affordability.
RIO mortgages can also be used to release equity from your home for your retirement. The mortgage is secured against your home, just as it is with any other mortgage, however, you will never need to repay the loan capital in your lifetime.
The lender will sell your home once you have passed away or moved into long-term care in order to repay the mortgage balance. If the proceeds of sale are greater than the value of your mortgage, the remaining funds from your home will go to your estate.
Equity release schemes
Equity release can be used for similar purposes to mortgages. From repaying your existing mortgage, to helping a loved one get onto the property ladder or simply accessing additional money for a more comfortable retirement.
However, there are risks involved with this type of borrowing including, tax, benefits and inheritance implications, that you should be fully aware of before you consider applying for the scheme. You can read more about equity release mortgages in our in-depth article.
There are two types of equity release product:
1. Lifetime mortgages
Lifetime mortgages can be taken out by anyone over the age 55 and are secured against the equity (or value that you own) in your home. This is similar to a RIO in that the loan is repaid after you've passed away or gone into long-term care, but in this case, you don’t have to make any repayments, unless you would like to.
If you are hoping to leave an inheritance from the sale of your home, it may be better to repay some of the interest charged on your borrowing. If you choose not to make repayments, the interest will be ‘rolled up’ (added to the loan) which will increase the amount to be repaid when your home is sold. Repaying some or all of the interest will minimise how much the interest eats into the proceeds of sale that can be passed to your beneficiaries.
2. Home reversion plan
Home reversion plans are far less common than lifetime mortgages, as they are much less flexible. For example, you're unable to move home if you decide that you want to. This is a simpler transaction, in that you are not borrowing any money, rather the lender is buying your home from you at a discount on the true market value.
This means that you will be offered somewhere between 20-60% of the cost of your home as a lump sum immediately, but you can continue living in your home rent-free until you die or move into long-term care. There are no payments to be made during your lifetime.
Which lenders offer mortgages to borrowers over 70?
There are a range of high street lenders who have extended their maximum age limits to 75 or 80 as to when you need to have finished repaying the loan. However, building societies and specialist lenders are likely to have greater flexibility of mortgages for the over 70s.
For example:
HSBC - maximum age limit is 75
Leeds Building Society- maximum age limit is 85
Specialist lender Aldermore - will allow repayment up to the age of 100 years old.
There are also some lenders without any maximum age limits at all, such as Loughborough, Suffolk and Cambridge building societies.
Why is it more difficult to get a mortgage over 70?
By the age of 70, most people will have retired, meaning their income is likely to be lower than that of working age people. Even those still in employment typically work shorter hours and have limited time left before they retire.
The major concern for lenders is whether the borrower will be able to keep up their repayments throughout the duration of the mortgage. As retired people typically have a lower income, affordability is therefore the major reason why it’s more difficult to get a mortgage over 70.
That said, if you're able to provide evidence of a reliable income, either from private pension schemes or ongoing business or investment income, you should still be able to get a mortgage, no matter how old you are.
Increasing your chances of getting a mortgage over 70
Anything that you are able to provide your lender to prove that you have sufficient income to maintain your mortgage repayments will put you in good stead. This can include:
A pension forecast
Investment statements
Assets, such as a buy-to-let property
Pushing age aside, the main things that will improve your chances of getting a mortgage over 70 and convince your lender to approve your application include:
Providing a larger deposit
Keeping on top of bill repayments and maintaining a good credit score
Keeping your credit record up-to-date and contacting credit reference agencies to correct any mistakes
Avoiding applying for any further credit
Creating a spending budget to cut unnecessary outgoings and increase your expendable income
Considering to ask a younger relative to be a guarantor
There are a varied range of options available to those looking at mortgages for the over 70s, each with their own benefits and considerations. That's why when you're deciding the best path for you, it's always best to seek advice from a specialist, especially when it comes to equity release.”Kellie Steed, Mortgage Content Writer
Mortgages for over 70s FAQs
Can I get a mortgage if I’m retired?
Yes, so long as your retirement income is able to cover the cost of the mortgage repayments, being retired shouldn’t prevent you from getting a mortgage.
How many years mortgage can I get at age 70?
This would depend on the lender and their individual maximum age limits. Some will only allow you a five year mortgage term, as their age limit is 75, however, it’s possible to get 15 and even up to 25 years with some lenders. Although, the latter is fairly rare.
How much can I borrow if I'm over 70?
Your age won’t directly impact how much you can borrow, but the length of mortgage term and affordability will. Lenders will have a maximum LTV (loan to value) that they will be able to offer any borrower, and the shorter you have to repay the loan, the higher the LTV is likely to be.
It will probably be difficult for most people to borrow as much at age 70 as they could 20 years earlier. However, it’s not impossible and is really down to affordability, as with any other mortgage. A broker who specialises in later life borrowing should be able to help you maximise your borrowing potential.
Can I get a buy-to-let mortgage if I’m over 70?
Yes, it can actually be easier to get buy-to-let mortgages than a residential mortgage, as the term lengths available are often longer and the age limits more flexible. This is because buy-to-let properties are typically more readily sold to repay the loan than personal homes.
Can I get an interest-only mortgage over 70?
Yes, you can get an retirement interest-only mortgage which is available to people over the age of 55. This mortgage allows you to only repay the interest each month, meaning it could be a more affordable option as repayments are smaller. The loan is repaid when you die or move into long-term care.