The spread of loan sizes available to customers aged 55 and over was also larger than the spread available to the self-employed and the overall market
Last month, while there was at least one lender able to meet the loan requested by 75% of mortgage customers across the whole of the market and 70% of self-employed customers, only 64% of customers aged 55 and over had at least one option for affordability, according to the latest findings from MBT Affordability.
The MBT Affordability Index found that nearly 9% of customers aged 55 and over were unable to secure a suitable mortgage of any size, compared to 2% of the self-employed.
The spread of loan sizes available to customers aged 55 and over was also larger than the spread available to the whole of the market and to the self-employed.
The largest loan available to an average customer aged 55 or over was £287,540 while the smallest loan was £147,372 – a spread of £140,168. This compares to the largest loan available to a self-employed customer of £231,206 and the smallest loan of £110,552 – a spread of £120,654. For the whole of market, the largest loan available to an average customer was £245,890 and the smallest loan was £145,742 – a spread of £100,148.
Tanya Toumadj, CEO at Mortgage Broker Tools, said: The latest MBT Affordability Index shines a light on the challenge that mortgage customers aged 55 and over face in securing the loan size they want. There are a lot of different factors at play here.
Obviously maximum age at the end of the mortgage term, and anticipated retirement age play a significant role in how much customers will be able to borrow and lenders often have different criteria in these areas, but there are also other considerations, she said.
She said: As customers grow older, in general, they also become wealthier and many will have additional sources of income to consider from investments and pensions. There’s a huge variation in the way that lenders underwrite these additional income sources and it means that the choice of lender can make a very significant difference to how much a customer aged 55 or over is able to borrow.