Mortgage Advisor & Director
Senior Equity Release Advisor
Today, many people are becoming homeowners later in life. Around a third of first-time buyers in 2023 were over 35, and two thirds of landlords over 55.
Luckily, lenders have begun to extend their maximum age limits as a result, so there are plenty of mortgages for pensioners that aren’t necessarily equity release. We look at the various options below.
What type of mortgages are available for pensioners?
The mortgages available to pensioners generally fall into the following three categories:
Mortgages with flexible age limits
Mortgages for pensioners over 65 and beyond are available from a growing number of lenders, although the selection does reduce with age. That said, some lenders have no upper age limits at all by which you need to have repaid the mortgage.
Building societies tend to be more flexible than high street lenders, but so long as you meet the affordability criteria, it’s possible to get a traditional mortgage well into your 60s and 70s. Keep in mind that the repayments are likely to be higher, given that you won’t be able to have such a long long term as younger borrowers.
Equity release mortgages
There are two types of equity release product available, lifetime mortgages and home reversion, although the latter are not very common in modern times.
A lifetime mortgage is for pensioners and homeowners over the age of 55. They involve borrowing money against the equity in your home as a tax-free loan, that can be repaid from the proceeds of sale after you die or enter long-term care.
A home reversion plan is also available for pensioners and homeowners over the age of 65. With this form of equity release you sell your home at below market value to a home reversion provider, but can remain in your home until you die and have no repayments to make.
RIO (Retirement interest-only mortgages)
RIO mortgages are specialist products aimed at the over 50s, although some lenders have a minimum age limit of 55. Despite the name, you don’t need to be retired to have one.
This is the same as a traditional interest-only mortgage as you only need to repay the interest each month. However, the loan is repaid when your home is sold, either when you go into care, or after you pass away.
Below you can comapare the latest mortgage rates for pensioners, or book a chat with one of our advisers, if you're unsure which option to choose...
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Age limits for traditional mortgages
A growing number of lenders are broadening their age limits on their standard mortgage products, meaning that those older than 65 have plenty of options available outside of equity release.
This table shows the number of UK lenders currently offering mortgage terms that end above 75 years of age. As you can see, some have no upper age limit at all.
|
Age |
Approx. Number Of Lenders Available |
|
75-80 |
50 |
|
80-85 |
35 |
|
85-90 |
18 |
|
No upper age limit |
12 |
Best mortgage lenders for pensioners
This table shows examples of mortgage lenders who specialise in pensioners and cater for their needs well, with flexible age limits and a range of retirement mortgage deals.
|
Lender |
Products Available |
Age Limits on Product |
|
Traditional, RIO and equity release |
No upper age limit |
|
|
Traditional mortgages |
95 years if receiving pension |
|
|
Traditional and equity release |
80 years on standard interest-only, no upper age limits otherwise |
|
|
Standard and Buy-to-let |
No maximum age limit |
|
|
Buy-to-let |
No maximum age at end of term, no maximum age on application if lending below 65% LTV |
Remortgaging in later life
While there are products available, it can be more difficult to remortgage as a pensioner. This is because income is typically lower after retirement, so affordability criteria are harder to meet. You’ll also likely only qualify for a fairly short term, depending on lender age limits, which can also push up the monthly cost.
However, if you have a good level of equity in your home and are able to prove that you can afford the repayments, it’s perfectly possible to remortgage as a pensioner. It’s usually easier to remortgage if you’re downsizing to a lower value property, as the repayments should be lower.
Buy-to-let mortgages for pensioners
As over 60% of landlords in the UK are over 55, buy-to-let mortgages tend to be more readily available to older borrowers. This is because the lending is considered lower risk for a number of reasons.
Landlords typically repay their mortgage with rental income, meaning they don’t need to meet affordability through their pension. Equally, investment properties can be sold to repay the mortgage more easily than your residential home, particularly if you have a large portfolio.
Why choose Teito for your retirement mortgage?
Here at Teito, we’re experienced in all areas of later life lending, so whether you’re looking for a traditional mortgage in your 60s or need regulated equity release advice from a member of the ERC (Equity Release Council), speak to us today.
- We’ll help you assess all of the pensioner mortgage options available to you during a FREE no obligation consultation
- Our specialist brokers will support you through the application process, should you decide to proceed
- We won’t leave any marks on your credit reports
- We’re rated 5 stars across a number of review platforms, such as Trustpilot
Ready to take advantage of a free, no-obligation chat with a broker who specialises later life mortgages to find out what your options are? Get started here.
FAQs
Yes you can, there is a specific Shared Ownership scheme available to those over 55. The criteria vary from lender to lender, but most won’t allow you to buy more than 75% of the property, with the housing association retaining the remaining 25%.
However, this can be a viable option for older borrowers on a lower income.
Choosing an Adviser
Selecting a qualified and experienced mortgage adviser is of great importance. To choose a suitable adviser, evaluate their qualifications, experience, and reputation, and ensure they are regulated by the Financial Conduct Authority (FCA).
Read reviews from previous clients and make sure they provide a clear explanation of the products and services they offer, as well as the fees and charges associated with them.