BORROWERS as young as 40 are struggling to get approved for mortgages or re-mortgages because of their age
BORROWERS as young as 40 are struggling to get approved for mortgages or re-mortgages because of their age.
Nottingham Building Society reported that nearly two in five (37 per cent) mortgage brokers had seen a rise in over-40s struggling to be approved for mortgages or re-mortgaging.
Lenders are wary of lending to older borrowers as they are closer to retirement age, and therefore a riskier prospect of being able to pay back their loan in time.
A survey of customers found that 17 per cent had been turned down for a mortgage because of their age. This rose to 21 per cent among borrowers aged 45 to 54.
In some cases, prospective borrowers were turned down for a mortgage because one partner was deemed too old, or was not paying into a pension.
Earlier this year, the Co-operative Bank paid £2,000 in compensation and was forced to change its policy after the Financial Ombudsman Service ruled that it had discriminated against a 69-year-old borrower who had wanted to extend his mortgage by five years.
Ian Gibbons of Nottingham Mortgage Services said: “It is baffling for people in their early forties to be told they are too old to have a mortgage - and particularly so when the average age of first-time buyers is rising, which means some could even be first-time buyers.”