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Nationwide latest lender to hike maximum age limit

Jordan
Henry Jordan: ‘Growing demand for credit in later life’

Nationwide has become the second major lender in a week to loosen its lending into retirement criteria.

It will increase its maximum lending age by 10 years to 85 in July, giving it the highest age cap of all of the major high street lenders.

Existing customers with retirement income will be able to borrow up to age 80 with the loan having to be repaid by age 85.

The option will be available on all standard Nationwide products to 60 per cent LTV and a maximum loan size of £150,000.

Nationwide head of mortgages Henry Jordan says: “We are taking a series of steps to meet a growing demand from customers to be able to borrow in later life. These customers are often asset rich, with significant equity in their home, and they wish to have the flexibility to borrow against it.

“Access to the mainstream market has been a challenge for older customers, resulting in their needs going unfulfilled. This measure helps to address these needs in a prudent, controlled manner.  Nationwide is committed to providing a range of options for all customers and this will be the first step toward developing a wider range of options for those looking to borrow into retirement.”

Last week, Halifax increased its maximum lending age from 75 to 80.

However, the other major banks are lagging behind, with building societies leading the way when it comes to lending to older borrowers.

The Building Societies Association says half of its 44 members now have maximum age limits of at least 80, with 10 of them having no age caps whatsoever. Six have increased their age caps in the past six months.

In contrast, banks are much more restrictive. HSBC, Santander and Virgin insist that the borrower repays their loan by the time they are 75. Barclays and Royal Bank of Scotland have a maximum age limit of 70.

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  • Carl McGovern 13th May 2016 at 10:26 am

    That’s another step in the right direction, although I am still baffled by some criteria on this subject, applied by certain lenders. I have been trying to place a case with Accord, as the deal, they have seems best for my client. On checking the affordability, I need to take the term to age 75 which Accord will normally allow. I have checked the clients retirement Income and at age 65 he has a very good Pension from his former employer. The scheme he is in is the local government final salary scheme and he has supplied me with an annual statement. this together with his state pension, payable at age 67 actually gives him more than his current level of Income.

    Strangely Accord won’t allow him to borrow beyond age 70 though, as he isn’t actively paying into a pension at the minute! I am struggling to get my head round the lenders thinking here, but have had to place the case elsewhere, as they are sticking rigidly with this.