UK has extended housing loan to the shocking age of 105

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Since the budget package announced in April this year, allows pensions to be diversified, to seek higher rates and earn more retirement income, a boom has created an upsurge of income for retirees. The Guardian reported that the government will provide loans to retirees, the loan period can be long as 105 years old, and it is because that in April this year, the British Chancellor George Osborne has decided to release the ban on pension restrictions, all depositors can retire at the time of pension withdrawal, in addition to the purchase of annuities and day to day expenses, retirees can also withdraw their pensions in cash at the age of 55.

Before this policy lunch, many lenders and banks refused to provide loans for applicants at the age of 75 or above 75, The mortgage works had set the age limit for the rental scheme, stipulating that the owner must pay off the loan before the age of 90, and the corresponding borrower must be less than 75 years old to participate in the rental scheme , from now on, the restrictions is that the loan applicants must apply for a loan before the age of 70, and the new policy will provide more room for the pensioners.

And the terms of the loan are also increasingly liberalized, before the banks generally required that the housing buyers whom apply for the buy to let loans must have an annual income of more than £25,000, and UK property income shall not taking into consideration. Now, there are many banks take the property income into count, which means that the crowd of housing will surely expand.
Experts believe that many people will abandon the traditional annuity, instead, they will transfer the money to the rental market, the advantage of which is that the purchase of the interest repayment system, as long as the end of the contract to resell the property, they do not have to repay all the loans, if the real estate appreciation, then the difference shall goes to the house holder.

Economists from local loan agency believe that with the implementation of the policy, as well as the rapid growth of Britain’s population, the increase in the number of homes in Britain will push up prices further. Data show that the number of elderly people consulted on the purchase of rental plans rose by 20% compared with last year, although house prices rose 8.4% in one year, more and more landlords are in the competition to buy house, At the same time, as the economic situation is getting better and wages are steadily increasing, experts believe that the loan age limit is lowered, the low loan interest rate, the rising demand of the leasing market and the relatively low savings and pension rates make it a relatively safe way to rent.

Loan agent said that a mortgage loan is easier to apply compared with housing loan because the landlord can repay the monthly loan and will not fall as the landlord retires, while on the contrary, if it is a housing loan and the landlord usually pays the loan with the salary income, then there is no guarantee that the repayment capacity will remain after retirement. It should be noted, however, that pensioners should not only focus on simple patterns and heights but instead overlook the estimated payback time and the required energy, some people may have seen the house rent, but not ready to deal with housing vacancy or house price fall, or other issues, or not ready to assume responsibility as a landlord, and to undertake the corresponding housing maintenance costs, which are all the possible risk issues.

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