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Leeds Building Society now accepts residential mortgage applications from borrowers aged up to 85 at the end of their mortgage term and has removed the age limit completely on its buy-to-let mortgages.
The decision from Leeds Building Society to accept older borrowers follows on from research carried out by Moneyfacts.co.uk that showed the number of 40-year mortgages is on the rise. This continues a trend of more mortgage providers being willing to lend to older borrowers. In fact, with the minimum residential mortgage term being offered by Leeds Building Society at five years, it means that those aged 80 can apply for a mortgage.
Along with the increase in mortgage terms and relaxing of maximum age limits, many providers now also offer retirement interest-only (RIO) mortgages. These mortgages are designed for those on interest-only mortgages who do not have the money to repay the mortgage at the end of the mortgage term and those who want to release equity from their property, but do not want to take out equity release. A RIO mortgage allows retirees to stay in their home and only pay the interest on their mortgage loan. The money borrowed is paid back when the borrower either goes into care permanently or dies.
Matt Bartle, director of products at Leeds Building Society, said: “We keep all our lending criteria and our product range under constant review and are always seeking out new ways to deliver on our mission to help more people have the home they want.
“This criteria change is the latest improvement we’ve made, supported by our understanding of customer need in this evolving market.
“That's informed our innovation in later life lending – for example, it’s almost a year since we became the first national high street lender to launch RIO mortgages.
“We chose to enter that new market following extensive research into borrowers’ needs as they age and how to support them in later life and we continue to work closely with consumers and our broker partners to further enhance our later life lending proposition.
“Mortgage choice is always a highly personal decision and, for older borrowers in particular it’s essential that they take appropriate advice bearing in mind their financial position as a whole.”
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