You may have seen last week’s Watchdog where an article covered the maximum age that most high street lenders will allow customers to keep their current mortgage to. The report, in the main, suggested that on the high street the term of a mortgage must finish when a customer’s age reaches 70. A small number of lenders went slightly higher with one allowing a maximum age of 80. But what happens when that age is reached and there’s still a debt outstanding? Although the top six lenders have these stipulations, there are a further sixty other lenders who offer different criteria. For example, we recently arranged a traditional style of mortgage for a 92 year old! If the case is good, affordable and has a good amount of equity in the property, then there is every reason for a lender to carry on to lend to that customer. You just need to know where to look and be happy to deal with a non – household named lender!
The rate price war has continued this week with a number of lenders lowering their two year fixed rates. These are now at an all time low and some, for those with a 40 per cent deposit, can now offer rates in the late 1% range!
Finally, we’re seeing a lot of first time buyers turn to the bank of Grandma and Granddad as the bank of Mum and Dad appears to be running a little dry! There are various ways in which the older generation are helping the first timers. Some are gifting deposits, to help those get on the property ladder. With most products, the larger the deposit, the lower the interest rate. Others have agreed to the placement of a collateral charge on the parents or grandparents property. This gives a lender more security and maybe a better credit risk rational to the deal, than originally might have been the case. In some cases the parents have joined in to provide additional income support and bolster the overall application. Whichever way required, always explore the options and have a conversation with a professional as there may just be an alternative way to do the deal.