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More pensioners paying mortgages

Journalist: Lana Clements, The Sun

ended 02. August 2023

Figures show the cost of living crisis is impacting pensioners as more don't have  savings but are still paying mortgages.. 

I'm just looking for some comment around this issue and some practical advice about what people in this situation can do…

For the Sun. 

thanks   

Lana

3 responses from the Newspage community

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Editor
Stephen Perkins
Managing Director at Yellow Brick Mortgages
With more and more clients over recent years taking long-term mortgages going into their 70s to make the monthly payments affordable, it is no surprise that those now on fixed pension incomes still with outstanding mortgages are struggling as every outgoing from heating, food and mortgages have now been impacted by increases from this cost-of-living crisis. Any savings such pensions did have is now being evaporated.

With the mortgage charter allowing others to extend their term currently and lenders raising maximum working ages this will be a growing problem in the future.

It is certainly worth pensioner homeowners seeking professional advice on their options which may include Retirement Interest Only (RIO) mortgages, equity release, or of course, downsizing if possible.
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Gary Bush
Financial Adviser at MortgageShop.com
Pensioners having mortgages is a thing of the future now with people working at least part time until at least their mid 70's. Pensioners having difficulty in making payments should speak to their lenders about the potential of lengthening the term on the mortgage, if this fails engage with a decent financial practice specialising in mortgages that can intermediate with the lender.
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Ben Tadd
Director at Lucra Mortgages
In the short term, older mortgage borrowers that still have a mortgage can contact their existing lenders in the first instance to ask what options they have available to help. The new mortgage charter that a significant amount of high street lenders have signed up to, now allows borrowers to either switch their mortgage on to interest only, or extend the mortgage term for up to 6 months. The aim of which is to help reduce mortgage payments down, whilst rates remain high. However, borrowers need to be aware of the associated risks here too, as they will end up paying more interest by electing to go down either of these routes. In the long term, older borrowers will need to try and ride out the storm of higher interest rates until the base rate peaks and then interest rates start to drop down, which will then trickle through to the mortgage market and result in lenders dropping their rates down to a more affordable level.