Following Barclays’ launching the 100 per cent mortgage, stirring up much debate concerning the bank of mum and dad, the Halifax announced that they are increasing the mortgage lending age limit from 75 to 80.
A 55-year-old person will be able to take out a 25 year mortgage and have until their 80th birthday to repay the loan.
Halifax said, “As demographics and working habits continue to change, we continually review our products and policies to ensure they reflect the evolving needs of our customers, including those who wish to continue working longer.”
Matthew Graves, Sales Director at Enness Private Clients, said, “Thankfully, attitudes to older borrowers in the mortgages market are changing.
“At Enness we once had an 88-year-old client who, in spite of his substantial assets, income and impeccable business records, had been rejected by every lender he approached; we were only able to secure him a mortgage by speaking directly to the underwriters. Someone’s age is not necessarily an indication of how credible a borrower they are and, although this latest development is a step in the right direction, rigid upper age limits should be regularly reviewed.”
In the same day, Barclays launched their new 100 per cent mortgage, a product that has, since the ‘credit crunch’ been seriously frowned upon.
However, there is no sign of these loans being handed out like sweeties at the funfair, these loans come with strings attached, some of which will be around parents of the borrower, who will be called upon to help and means tested in the strongest terms.
Matthew Graves added, “Currently around 35 per cent of first time buyers have to borrow from their parents to put down a deposit. Removing the need for a deposit opens up a new avenue to explore for families wishing to give their children a leg up onto the property ladder. That lenders are willing to use a multiple of 5.5 for the income of borrowers earning over £50,000 is also a positive. From that point of view, it’s a fantastic product.”