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A Guide to Mortgages for Pensioners

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Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: June 9, 2022

It’s not unusual for people to look for mortgage solutions when they reach retirement, so we’ve put together this guide to mortgages for pensioners to answer some of the questions we hear from older people who are looking for mortgage solutions.

Can pensioners get a mortgage?

Yes, there are specialist mortgage providers who offer flexible deals for older people. Many of them don’t have the age restrictions that some mainstream banks and building societies impose, which is good news for anyone in or approaching retirement.

Moreover, there are also specific mortgage products aimed at elderly customers, including lifetime mortgages and equity release. We will discuss both of these options in this article.

How can older people get a mortgage?

Mortgages for pensioners aren’t all that different from getting a mortgage at any other time of life, although there are a few exceptions.

It all comes down to a few key questions, including:

Before you approach a high street lender, you should get the right advice from one of the advisors we work with. They’re experts when it comes to finding mortgages for people who are retired – it won’t cost a penny and, unlike a lender’s broker, they won’t leave footprints on your credit rating.

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Age restrictions

There isn’t necessarily a maximum age for an older person applying for a mortgage. However, most lenders have their own age limits that they use to cap eligibility on a mortgage and to decide the terms of the agreement.

For most lenders, this age is 70, however, there are some mortgage lenders who specialise in mortgages for the elderly with a higher age limit of 85 and a few who will provide with no maximum age limit, under the right circumstances.

Alternatives to consider

If you already own a property, there are a number of options open to you which could include:

  • Remortgaging to release capital tied up in your property
  • Equity release mortgages
  • Downsizing
  • Retirement interest-only (RIO)
  • Friends and family mortgages


As mentioned above, there are a few options for releasing equity with mortgages for pensioners in the UK, such as remortgaging to unlock a cash lump sum. You can read more about remortgaging in retirement in our handy guide here.

Alternatives you could potentially consider include…

Home reversion plans

If you choose a home reversion scheme, you’ll be selling all or part of your property at less than its market value in return for a tax-free lump sum, a regular income, or both. You’re able to remain in your home as a tenant, paying no rent.

This kind of scheme is less popular than it once was since, unlike equity release or lifetime mortgages, you don’t actually own your home (or part thereof) and could lose it under certain circumstances.

Equity release mortgages for older borrowers

Equity release is a standalone product category in its own right and not to be confused with releasing equity (i.e. unlocking the capital you’ve built up in your home, via a remortgage).

There are a range of different equity release mortgages on offer:

Lifetime mortgages

This is a specific type of borrowing for someone over the age of 55. You essentially take money from your property and have the interest rolled up over time without the need to make any monthly repayments.

The beauty of this mortgage is that, because you retain ownership of your property, you are able to live in your home until you either die or go into long-term care.

The loan to value available will increase with the applicant’s age. The older you are when you apply, the less time there is for interest to roll up, so the initial loan will increase.

There should be a non-negative equity guarantee option, meaning that you will never leave debt behind.

Read more about lifetime mortgages.

Retirement interest-only mortgage (RIO)

A retirement interest-only lifetime mortgage is a type of loan secured against your home that allows you to release equity from your property. As with an interest-only mortgage, you’ll be expected to pay the interest of the loan on a monthly basis, which ensures that the balance of the loan remains level.

The remaining balance is usually paid back from the sale of your property when you die or move into long-term care. If there’s any money left over after paying your loan, this is inherited by your beneficiaries.

Hybrid equity release

Also called a part-and-part mortgage, these are an interest-only and repayment mortgage hybrid – a “middle ground”, combined solution.

Instead of paying back the full loan plus interest over an agreed term, as you would with a repayment plan, you only repay the interest owed along with an agreed proportion of the mortgage each month.

This means that when the term comes to an end, you’ll still have some remaining capital to repay on the property.

Talk to one of the expert brokers we work with. They’ll be able to talk to you about your individual circumstances and explain the pros and cons of each option according to your needs and requirements.

Eligibility Criteria for retirement mortgages

Your eligibility for a retirement mortgage can vary depending on the type of mortgage you’re applying for, the lender and many other factors.

If you’re applying for a repayment mortgage, some lenders can view older borrowers as riskier. This is because if you retire before you’ve finished paying off your loan, you won’t have a regular salary, and lenders will be unsure if you will still be able to afford the mortgage repayments.

However, if you’re applying for a loan that is secured against your home, such as equity release, your income is often less of a factor for lenders as you will not be expected to make repayments.

What retirement lenders look at when assessing a mortgage application

To ensure you’re eligible and can afford to take out a retirement mortgage, lenders will carry out checks which may involve looking at:

  • The type of mortgage you’re applying for: Your lender will assess your application differently depending on whether you are applying for a traditional mortgage or equity release.
  • Your health: This can affect the amount you can borrow if you are securing your retirement loan against your house. Impaired or enhanced lifetime mortgages may allow you to release more.
  • Your age: If you are a younger applicant, you may be able to borrow less money with certain retirement mortgage products such as equity release. However, if you are applying for a repayment mortgage, being younger and therefore further away from retirement could mean that lenders are more willing to lend to you.
  • Your income: If you are applying for a repayment mortgage rather than a loan secured against your property, your lender will want to be confident that you can afford your mortgage repayments.
  • Property type: Lenders prefer standard construction properties as these are easier to resell if they have to repossess.

Credit history: This could affect how lenders judge your ability to repay your mortgage or interest payments if you take out a retirement interest-only mortgage.

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How much can an older person borrow?

If you’re applying for a standard repayment mortgage and are yet to retire, some lenders will be happy to provide a 75% loan to value (LTV) ratio deal. Of course, the amount you can borrow is also affected by the value of the property you would like to mortgage, your income and your credit history.

If you are retired, some mortgage lenders will only be willing to provide a lower LTV of 50%. This is because you are no longer working and may only receive a pension as your income, therefore lenders perceive this as a higher risk that you won’t be able to keep up with your mortgage repayments.

How retirement mortgage lenders assess income

A lender will want to be confident that your loan is affordable based on your income during retirement. Loans are generally capped at 4.5x income, although some lenders may consider loaning 5x, and in the right circumstances, a few may go as high as x6.

Your lender may take your pension, benefits and any savings you have to determine what your income is and whether it is viable to sustain repayments throughout the term of the mortgage.

Getting a mortgage on a retirement apartment

With some lenders it’s possible to mortgage an apartment in a retirement complex. However, it’s always important to read the terms and conditions of your agreement with the retirement housebuilders, as it may have certain restrictions on to whom and when it can be sold.

If there are restrictions, this can limit the number of lenders who are willing to approve your mortgage and a more specialist lender would be required.

For more advice on applying for a mortgage in retirement for a non-standard property or for a retirement apartment, make an enquiry.

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What to do if you’re declined

If your bank refuses to provide a mortgage for you as an elderly borrower, most brokers would suggest that you avoid making multiple new enquiries right away. This is because each time you make an application for credit, this can show up on your credit report which lenders will look at to assess whether to approve your mortgage.

If you have recently applied for credit with multiple lenders, this can create the impression that you’re desperate for funds.

This is why speaking to one of the mortgage advisors we work with is so important.  They specialise in mortgages for the retired as well as other issues such as bad credit. Not only will they be aware of the lenders more likely to approve your retirement mortgage but they will also speak to the lender on your behalf.

Get matched with a retirement mortgage broker today

It’s important to look at all of your options when considering a retirement mortgage as there may be other alternative loans that may be more affordable or better for you as a pensioner.

With access to over 100 mortgage specialists, including mortgage brokers for pensioners, we’re confident that we can find the right broker to help you find the best solution for you.

If you have questions and want to speak to an expert for the right advice, call 0808 189 2301 or make a quick enquiry.

We’ll match you with one of the expert brokers we work with, ensuring that they have experience in arranging mortgages for retired customers. Your first consultation with them will be free with no obligation to proceed, and it won’t leave marks on your credit report.

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Can I get a mortgage as a retired teacher?

Yes, this could be possible. It depends on your personal circumstances and the lender, as each provider will have different criteria that they use to decide whether they will approve your mortgage.

Some lenders provide a 75% loan to value (LTV) for teachers who are currently employed but will be in retirement during their mortgage term. There are also some lenders who will provide a lower LTV of 50% on mortgages for teachers who are already retired.

Are there mortgages for retired police officers?

If you are a retired police officer or a police officer who wants a mortgage but will be in retirement during the lending period, it is possible to obtain a loan. In fact, there are specialist lenders who specifically provide mortgages for police officers who have retired.

The amount of loan you are approved for will vary depending on the type of mortgage you would like, the property type, your age, income and other factors. Because of this, it can be helpful to speak to a mortgage broker who has experience with finding lenders for elderly borrowers, specifically police officers.

Are there mortgage loans for retired military personnel?

There are mortgages for older military borrowers available and when lenders assess your application, they will carry out the usual affordability checks to determine whether they can approve your mortgage. This will involve looking at your pension and calculating whether you can afford your monthly mortgage payments.

Can you get a joint mortgage with retired parents?

Some lenders have age limits that they impose on their borrowers which could be capped at 75. Therefore, if you want to take a joint mortgage out with your son, daughter or even a younger friend, you may find it difficult to find a lender.

That’s not to say that it’s impossible though as the advisors we work with may be able to find you a specialist lender who is more lenient with age caps.

If you took a joint mortgage out with your child, on your death they would need to transfer the property and the outstanding mortgage to a sole ownership mortgage. Therefore, it may be a good idea for both parties to ensure your child would be able to afford the mortgage alone, before agreeing to a joint mortgage.

Are there mortgages for older first-time buyers?

Yes, there are lenders who accept applications from older first-time buyers. Some may have first-time buyer mortgage age limits, so speak to a mortgage advisor before making an application and they can find the lenders most likely to accept and approve your application.

Are secured loans available for pensioners?

Yes. Secured loans, or second charge mortgages usually have similar age requirements to standard mortgages, although some lenders can be more flexible with this type of finance.

You can read more about these products in our guide to second charge mortgages.

About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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