It was just a couple of years ago that many providers were reluctant to lend to older borrowers but now they are actively trying to attract this type of customer with some game changing mortgage products which are tailor made for older borrowers.
Following some valuable and recent extensive research conducted by Ipswich Building Society, it appears younger borrowers are more optimistic about clearing their mortgage repayments than the older generations.
The reasons why older and younger people take out a mortgage couldn’t be any more different. Older borrowers tend to use this to facilitate a move to a dream home or make renovations to their existing property. They are also more inclined to take out a mortgage to help younger family members.
Younger borrowers, on the other hand, appear to mainly be focused on getting their first foot on the property ladder and buying their first home, as they clearly see this as both a long term safe investment, and also, in the golden age of social media, it usually gives off the impression that you are succeeding in both life and career.
Over a third of people (37 per cent) expect to have a mortgage after 50 due to reasons other than not having reached the end of their term. The most popular reasons cited were:
- To cover living expenses: 15%
- Invest in a new property: 13%
- To free up funds to spend on holidays, car etc: 11%
- To extend or make changes to current home: 9%
- Due to changes in employment status/career: 9%
- To give inheritance to children/grandchildren: 7%
- To cover the expense of looking after parents in old age: 4%
Anyone requiring clarity about later life borrowing should seek the advice of an independent financial advisor who has expertise and qualifications in this market.