It was announced in the press today that the Halifax and Standard Life are to start offering mortgages with upper age limits of 80 years rather than 75. This has come about as a consequence of the population living, and working, longer. We now have over 12 million people in the UK over the age of 65, with no mandatory requirement for retirement. With the prospect of living longer and working longer it makes sense to extend the upper age limit for finance.

Mortgage Deed

A number of smaller, tertiary, lenders have targeted this ‘older’ market in the past but with more restrictive lending terms and, usually, higher interest rates. Older borrowers, who had the income and affordability to repay a mortgage in their middle age were being discriminated against. This change by Halifax (and Standard Life) brings mainstream finance to the average customer.

I have many clients who would like to refinance their homes, either for equity release to buy a holiday home, adapt their house, add a conservatory or simply release funds to help their children, or grandchildren, with a deposit on their first home but who found that beyond 50 years old they suddenly encountered a market fairly restricted mortgage market. And beyond 55 years of age the mortgage market was exceptionally limited.

Halifax is often a ‘driver’ in the mortgage market, encouraging other competitive lenders to follow suit. This will hopefully open up an array of affordable finance options to middle aged, comfortably off, home owners.

Despite mortgage lending surging in March, ahead of the Stamp Duty Surcharge implementation for second homes and Buy-to-Let investments, borrowing overall remains at historically low levels. Rates have recently fallen with average 2 year fixed rate mortgages at 2.55% and 5 year fixes at 3.19%. With property values rising on average by over 6% per annum this is a good time to invest in bricks and mortar, obtain finance on highly competitive terms if you have the affordability.

Michael J Moore FNAEA, MARLA – Senior Partner