Mortgage lending into retirement is becoming more popular as people live longer and need more financial assistance to stay in their homes. Mortgage lenders also typically offer incentives such as lower interest rates and longer repayment terms to encourage seniors to take out loans.

However, there are risks associated with taking out a mortgage loan at an older age, so it’s important that seniors consult with an expert mortgage adviser and research the different kinds of loans available before making a decision. This article will show you multiple great loan types for seniors.

Can I get a mortgage while being retire?

You can get a conventional mortgage while being retired, but the qualification process will be more difficult depending on your level of income and financial situation. Income from national insurance/benefit income, pension income, or retirement income may be considered when trying to qualify for a mortgage loan.

You may also need to have a large down payment available if you don’t make enough money each month. The higher your current income/actual income, the more likely you are to pass affordability assessments as long as you show income proof. Joint borrowers can also greatly increase your chances of acceptance on your residential mortgage application due to your total actual income increasing as the joint application contains multiple retirement incomes/job incomes.

Most lenders will also want to see that you have at least 6 months of cash reserves set aside. It’s important to shop around for the best mortgage deal as each mortgage provider has its own specific criteria and may use different standards for examining your financial situation as it applies to a mortgage loan.

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Equity release will reduce the value of your estate and can affect your eligibility for means tested benefits.

Equity Release

An equity release mortgage is a financial product that enables individuals to access the accumulated wealth tied up in their home and use it as income while maintaining ownership.

Equity release lets homeowners aged 55 and over release tax-free cash from the value of their homes. The amount you can release is based on your age and the value of your home. You can either get your money as one large payment or as a series of small regular payments, depending on the equity release product you choose. It is a great option for borrowers at different retirement ages as they can access some capital.

How much can I release?

The amount you can release will depend on how old you are, the loan size on the current property and the equity release plan you select.

If you’re over 55 years old, then you can usually release at least 23% of your mortgage. On a £200k mortgage, this would be £46,000.

If you’re over 65 years old, you can usually release at least 33% of your mortgage. On a £200k mortgage, this would be £66,000.

If you’re over 75 years old, you can usually release at least 43% of your mortgage. On a £200k mortgage, this would be £86,000.

If you’re over 85 years old, you can usually release at least 50% of your mortgage. On a £200k mortgage, this would be £100,000.

If you’ve got a larger property, then you can release even more.

The maximum loan equity release on a property is 60%.

For example, if you own a £300k property, at 60%, you could release £180,000.

What are the different types of equity release schemes?

There are two forms of equity release:

Lifetime Mortgage

A Lifetime Mortgage is a loan that is secured against your home. With this type of mortgage, you do not make any monthly repayments until you pass away or move into long-term care. This type of mortgage allows you to access some of the equity in your home while still being able to continue living there.

Home Reversions

It is a type of equity release where homeowners sell a portion of their property, ranging from 25% to 100%, in exchange for a cash lump sum, a regular income, or a combination of both. The homeowner can continue to live in the property. These plans are typically available for homeowners aged 65 or older. Learn more by reading this article.

Which type of equity release is best for me?

The best type of equity release for your individual situation depends on your financial and personal goals. For instance, if you are looking to raise capital quickly, a lump sum might be the best option. Alternatively, lifetime mortgage terms may be better suited for those who want to access funds while they retain ownership of the property they are releasing equity from. Ultimately, it is important to choose a type of equity release that will best fit the needs and goals of your specific situation.


Downsizing allows a homeowner to borrow funds from their current home to purchase another, smaller house. This loan enables the borrower to take advantage of the equity in their current home and use it to get a lower monthly payment on the new loan. This can be great as this can potentially enable you to live mortgage-free. However, a drawback of downsizing is you have less living space and room to store your belongings in.

It is important to consider all of the options available when deciding which type of equity release is best for you. You should also consider the potential risks associated with each option, such as the possibility of negative equity if house prices fall or interest rates rise. Additionally, it is important to understand the fees and charges associated with each type of equity release product, as these can vary significantly.

Finally, it is important to seek independent financial advice before making any decisions.

Next Steps

Getting a mortgage into retirement is a complicated task. It is important to speak with a qualified financial advisor who can help you understand the different types of equity release products available and which one best suits your needs. They can also help you understand the potential risks associated with each product, as well as the fees and charges that may be applicable. Additionally, they can provide advice on how to make sure you are getting the best deal possible when it comes to mortgage lending into retirement.