Can I get a mortgage at 60?

Yes, you can get a mortgage at 60 but you might need to opt for a shorter mortgage term. 

You’ll also need to demonstrate you can afford the mortgage into retirement.

It can be more difficult to get a mortgage when you're 60 or over because your income is likely to drop when you retire.

You might want a mortgage when you’re over 60:

  • to remortgage

  • to move house

  • to buy a house after separation or divorce

The Mortgage Market Review

In 2014 a new set of rules called the Mortgage Market Review were put in place.¹ 

These rules mean lenders have to carefully check whether a buyer can afford their mortgage over its term.

These rules make it more difficult to get a mortgage over the age of 60.

As well as mainstream mortgages, over 60s can also apply for the following types of mortgage:

  • retirement interest only

  • equity release

How to get a mortgage for over 60s

If you’re over 60 and applying for a mortgage you’ll need to commit to paying off the loan before you reach the lender’s age limit.

This age limit is the maximum age you can be at the end of the mortgage term.

For example, Barclays has an age limit of 70. So if you’re 60 you’ll need to repay the mortgage in 10 years.

This age limit varies from lender to lender. 

Some lenders don’t have an age limit at all.

You can read more about getting a mortgage over the age of 60 in our guide to mortgages for older borrowers.

When will you retire?

Retirement age can vary from person to person. 

Although most lenders state a maximum age at the end of the term, many also include a rule along the lines of “the mortgage must be paid off by the stated age or retirement age, whichever is earlier”.

This rule takes into account your individual retirement plans. This might be State Pension age, or earlier or later.

However, some lenders will be happy to lend to you after you have retired. 

They’ll assess whether you can afford your mortgage by considering your retirement income.

This might be money from:

  • a State Pension

  • a workplace or private pension

  • investments

  • property

  • savings

  • a job

Mortgage types for over 60s

There are some mortgages designed for those aged over 60. 

These include:

  • retirement interest only mortgage

  • equity release

  • lifetime mortgages

Retirement interest only mortgage

A retirement interest only mortgage (RIO) could be right for you if you’ve already paid off your home and have equity in it. For example, you might be remortgaging or downsizing.

A RIO mortgage allows you to borrow against your property and only pay back the interest each month.

This will mean lower monthly payments than if you also paid back part of the capital each month.

The capital is usually repaid when:

  • you sell your property

  • you move into residential care

  • you die

Equity release

Equity release is offered to borrowers aged over the age of 55 with equity in their property.

Equity is the part of your property that you have paid off.

There are two equity release options:

  • lifetime mortgage

  • home reversion

Lifetime mortgage

A lifetime mortgage is a lump sum loan that’s taken out on your property.

The loan plus the interest is paid off through the sale of your house when you pass away or move into residential care. 

Most lifetime mortgage providers have a 'no negative equity guarantee'. 

This means you will not be asked to pay back more than your home's sale value.

Taking out a lifetime mortgage means you’ll be reducing the inheritance you pass on to your relatives when you die.

There are 3 main types of lifetime mortgage:

  1. The drawdown lifetime mortgage

  2. The roll-up lifetime mortgage

  3. The flexible lifetime mortgage

Find out more in our lifetime mortgage guide.

Home reversion plan

A home reversion plan involves selling a percentage of your property in return for a cash lump sum.

You become a co-owner of the property with the home reversion company, but you have the right to live in it until you die.

Home reversion plans tend to be more expensive and less popular than lifetime mortgages. 

You normally need to be 65 or older to be eligible.

How to improve your chances of getting a mortgage over 60

If you want to get a mainstream mortgage over the age of 60, you’ll need to prove to lenders that your income is sufficient to afford the monthly payments. You’ll also need a decent credit score.

To qualify for equity release you’ll need:

  • to own your home outright (although you can use equity release to pay off your mortgage)

  • enough equity in your property

  • to keep your home in good condition

Lenders for over 60s mortgages

Building societies are usually happier than banks to lend to borrowers aged over 60. 

Many building societies do not have an upper age limit for when the mortgage needs to be repaid.²

Equity release products are sold by different lenders than mainstream mortgages. You should look for a provider that is a member of the Equity Release Council.

The Equity Release Council has a directory of equity release advisers ³ and equity release providers.⁴

An independent adviser can talk to you about how to release equity from your home. 

They can help you compare costs, as well as understand the down sides of equity release.

Sources

¹ The Guardian: Tougher mortgage rules come into force

² The Building Societies Association: Building societies' lending age limits and retirement interest-only mortgages

³ Equity Release Council: Advisers

⁴ Equity Release Council: Providers

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