Britain’s Nationwide Building Society increased its maximum age for mortgages from 75 to 85 in order to allow customers to borrow later in life and give them greater support in retirement.
“We are taking a series of steps to meet a growing demand from customers to be able to borrow in later life,” said Henry Jordan, the society’s head of mortgages. “This measure helps to address these needs in a prudent, controlled manner. This will be the first step towards developing a wider range of options for those looking to borrow into retirement.”
The new mortgage option will be available on all standard Nationwide mortgage products with up to 60 per cent loan-to-value and with a maximum loan size of about A$290,000.
Nationwide Building Society is following the footsteps of Halifax, which recently increased its age limit for mortgages from 75 to 80. According to the British bank, this was a response to changing demographics, with people living and working for longer.
A report from the Financial Conduct Authority showed that the number of consumers aged 65 in the UK is expected to increase by 1.1 million within the next five years. Another survey showed that one in three 20 to 45-year-olds expect to work beyond their retirement age to pay off their mortgage.
Hence, both Halifax and Nationwide Building Society are just responding to the many calls for lenders to do more to help older borrowers move to a new house or meet other needs.
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