Mortgages For Self-Employed Older People - Self-Build or Other

[Ferdinand]

Chatting today with friends thinking about sorting out their housing situation before retirement, they are trying to find a way out of rental.

 

The position is that they potentially have a significant deposit (for round here), and are looking to buy/renovate/extend or potentially self-build.

 

The complications are:

 

1 - He is a self-employed professional driver, aged just over 60. A couple of years of accounts + several years employed beforehand.

2 - She is not gainfully employed at present.

 

State and professional pensions will be along in a few years. The mortgage size is not a problem to manage if they can get a decent length of term, but the first broker contacted commented that the medical tests around being a professional driver would prevent mortgage lenders allowing a term beyond the age of 70. That makes the length of mortgage a problem, as a 10 year mortgage *would* be a strain.

 

Therefore they are looking for lenders who:

 

1 - Will consider self-employed.

2 - Will consider either pro-drivers beyond 70, or take pensions into account for the latter part of a mortgage term. It is likely that he will continue beyond 70 full or part time, but that does not shift the criteria.

 

Does anyone know of any possibilities?

 

I see that Cumberland Building Society will lend beyond 70, so they are one to contact for a start - but being a (relative) whippersnapper it is not an area I have researched before.

 

Any others?

 

Cheers

 

Ferdinand

 

Edited February 19, 2018 by Ferdinand

[lizzie]

Take the max mortgage they can get over a reasonable term for interest rates....to age.70 perhaps longer term more tricky and expensive. May be tight for a year or two but if he is still working potential for a bit more income.

 

Once house is done and they reach retirement age change mortgage into an equity release product so they have no outgoings and interest is clocked up and taken from sale proceeds when they die, equity release hopefully would raise enough to clear mortgage and they will have paid a bit off anyway during years  he was still working.

 

Will affect what they leave as inhertence but they will have a more comfortable retirement.

 

Only if the numbers work of course, if he has a huge mortage then eq release would not produce enough to oay off mortgage and you cant have both.  Worth doing some hypothetical calcs on line.

[ProDave]

Do the pension(s) have a lump sum element at retirement age?  If so you could consider that part being interest only with the pension lump sum clearing the debt at retirement?

[Ferdinand]

Yes ... pensions aspects are being thought about.