Max age for a Loan

R

roker

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Is there a cut off point for a loan? Can a pensioner obtain a loan if they have funds from several pensions?
At least they cannot lose their job, they have gauranteed income
 
Hello,

While strictly speaking a bank may not have a cut off point, it will have greater concerns about older people in terms of health etc. so may find other reasons to decline the loan application, rather than specifically refer to age.

If you are struggling to get a loan due to your age, but can afford the loan etc. then try your local credit union - they tend to be far more flexible on lending to the older generations.
 
Pensioners have guaranteed income until they die. Usually there is an age cut-off point with the lender not withstanding you have funds from several pensions. I know of no-one over the age of 70 that have secured a loan.
From a lenders perspective, I would expect they look upon pensioners seeking loans with suspicion as the logic would be that debt is paid off before retirement.
 
Nordkapp said:
....From a lenders perspective, I would expect they look upon pensioners seeking loans with suspicion as the logic would be that debt is paid off before retirement.
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I would not agree:

Why would there be suspicion because someone who is a pensioner wants to borrow (perhaps they have some capital outlay requirement and need a lump sum now to pay for it - new windows for the house, a new car, a holiday or whatever) ?

As for the "logic" I would accept your point if you were talking about someone buying their home, but not otherwise - using the examples I've given above once again.

I think many pensions would be up in arms about a thing called "ageism" if they were told they could not have a loan due to their age, hence I suggested that a Bank might find other reasons to decline a loan from a pensioner.

I can also tell you for a fact that credit unions will lend to the older generations and that I have personally seen loans issued to people in their sixties, seventies and even early eighties.
 
Agree with you in regard to Credit Unions however they are becoming like Banks. There is an age limit for mortgages and that was indicated to me when I made direct enquiries on behalf of a parent with sufficient funds for repayment and other funds.

Ageism is everywhere, it might not be said but the "risk versus repayment of loan" cycle is always considered by lenders. The risk of non payment or completion of the loan term is always a factor they would consider.
 
It's one of those things that makes very little sense when you think about it. Why wouldn't a bank lend €25k to a 66 year old who wants to do something, provided he/she had healthy pension income?
 
If they died the money could be taken out of their estate, this is less risk than losing your job. I just wanted to know the banks thinking on this.
 
Hello,

I think there is a separate argument for a Homeloan and other types of personal loans.

With regards to a Homeloan, the home should have been purchased and the related debt repaid by retirement age (if there is ever to be home ownership, which is not essential btw) - if anything, the homeowners should be starting to think about possibly downsizing, perhaps releasing equity along the way etc.

Sure, we can get into a debate about equity release loans / reversionary loans, but thats not always the right approach and also, not what I would call a mainstream loan.

As for other loans, they should all be readily available to all borrowers, once in good health, capable of repaying the loan, having a good credit record etc. I would support the Banks being entitled to look for health records, or to have the borrower get a medical exam as a condition of advancing loans over a certain size for example, if this put their minds at ease. However, the Banks need to remember that expected average life expectancy is now into the 80s and getting longer, so telling someone at age 66 that they are too old to get a loan is wrong.

I can appreciate that the risk of complications regarding older people getting long term illnesses and perhaps passing away are issues that a Bank might not want to get caught up in, but there is always the option of pricing for these risks. Likewise, there are ways to reduce this risk, such as checking current health status, getting assignment of small life policies or perhaps certain types of serious illness policies and so on. One glove clearly does not fit all, but when there's a will there's a way.....
 
Even a young person has to have a mortgage protection insurance in case of death
 
roker said:
Even a young person has to have a mortgage protection insurance in case of death
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Unless the rules have been changed, a person over 50-years of age getting a homeloan does not have to have an MPP.... I think it was due to cost, but have not looked at this for a few years (and as I said, the rules may have changed, so I'm open to correction).
 
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