Older borrowers have been the talk of the market this week, as many familiar high street names announced they would be raising their maximum age limits to meet increasing demand. Lenders have finally started to react to societal changes, ensuring the mainstream market becomes less of a challenge for older borrowers; something certainly worth celebrating. Following evidence that 1 in 3 20 to 45 year-olds expect to be working beyond state retirement age to pay off their mortgage, the need for enhanced support and more flexible lending within this space is obvious, and something we have been firm believers in for years.
Halifax kick-started the trend by announcing its upper age limit would rise from 75 to 80 across all its mortgages. Nationwide revealed a similar move, although in this case, increasing its maximum age limit from 75 to 85. Available across all mortgages up to 60% loan to value (LTV), with a maximum loan size of £150,000, this makes Nationwide’s offer one of the highest deal term-ends on the high street (and supposedly the first of a series of enhanced offers from the lender).
Across the market, HSBC, Santander and Virgin Money currently require borrowers to repay their loan by the age of 75, or 70 for Barclays and RBS. However, up to 22 building societies now lend up to the age of 80 or 85 with some even holding no maximum age limit at all.
Older applicants were not the only type of borrower in the limelight, however, as the market also became trickier for expats. Natwest and RBS announced they will no longer offer expat mortgages, including those for existing customers seeking additional finance or extending a term. This understandably caused a stir for many seeking finance from overseas, yet we can assure you it is still very possible to secure a mortgage as an expat and something we can help with.
For the buy to let sector The Mortgage Works’ (TMW) latest criteria change: increasing its rental cover requirement to 145% and reducing the maximum LTV to 75%. Although this may initially seem like bad news, some have suggested this signals the start of realignment in the sector, with a likelihood of high street lenders following suit. Despite this, many buy to let firms still offer access to high LTV finance, so whether the pressure of higher stress rates will provoke greater change, is still down to speculation.
Elsewhere, Aldermore launched a limited edition rate on both its specialised and standard buy to let mortgage range, available for loans from £250,000 to £1 million for both individual borrowers and limited companies. The 3.93% rate is for 2, 3 and 5 year fixes up to 80% LTV, for house purchase and remortgage with a 1.5% completion and £199 booking fee. By offering the same rate for 2, 3 and 5 year fixes, Aldermore allows greater flexibility to make a better decision for your situation, rather than simply opting for a quick fix.
Aldermore has also reduced rates across its commercial range for a limited time only. Marking the lowest ever commercial rate from the lender, this is a 0.4% discounted rate for owner-occupied and commercial investment mortgages between £100,000 and £500,000.
Another lender applying changes this week was Precise Mortgages, offering reduced residential mortgage rates for purchase, remortgage and buy to let. This includes a competitive 5-year fix at 3.99%, up to 75% LTV, or at 4.84% up to 80% LTV. The lender also revealed a range of fixed rates for purchase, remortgage and first time buyers, which includes a 5-year fix at 4.54% up to 80% LTV with no fee, or a 2 year fixed rate of 4.14% at 80% LTV with a £995 arrangement fee.
As far as 5 year fixed rates are concerned, Kent Reliance has re-introduced 5 year fixes to its core range in response to high demand. The 5 year fixed range is now available up to 90% LTV across the lender’s residential range, at 85% LTV for interest only residential deals and 85% on all buy to let products. By popular request, the lender additionally introduced a selection of Large Loans products for high net worth landlords with established portfolios, borrowing £1 million or more. This is available up to 80% LTV and features 2 and 3 year fixes from 3.79%, or 4.19% for 5 year fixes.
Finally, the Bank of Ireland has also revamped its product offering by applying rate cuts to all residential mortgages of up to 0.2%. As well as offering £400 cashback on completion and free valuation for help to buy mortgages, the lender also reduced 2 year fixed rates by up to 0.32% for buy to let. Rates now start from 1.97% and features a 60% LTV remortgage product with no fees.
The aforementioned rates are indicative of current market activity, yet private lenders will not publish their rates, so we are restricted in our ability to relay this information. However, we should emphasize the fact that their rates are often much more competitive.
There is no denying the pace has certainly picked up across the market for mortgage rates, especially as many industry experts expect lenders to follow suit and introduce criteria changes to rival their competitors. We are proud to offer the latest market changes at the tap of a button, s o stay tuned for the updates as they come.
If you have any questions on this article or market activity in general, please feel free to contact one of our expert brokers who will always be happy to answer your questions. Alternatively, you can stay on top of the latest mortgage rates and industry news with our daily rate updates.