Why would you want a mortgage after retirement age anyway? It is one of the biggest mistakes that I have seen from retirees who took out mortgages in the Celtic Tiger. Income reduced significantly, the debt doesn't, so it ends up taking up a very large proportion of their income.
the pension contribution required to support the extra mortgage payments would be better off paid against the mortgage to avoid the compounding of the interest.
Agree completely hereFor example,within a few years of retirement, it can be very tax efficient and the lump-sum on retirement can be used to pay down the capital on the mortgage.
The fact that many people made stupid mistakes during the Celtic Tiger should not be used to write off a very useful mortgage product.
I come across many people in their 50s, who have a mortgage of €100k on a house worth €300k. They will not have the capital paid off by age 65, so the lenders are classifying them as unsustainable. This is absolute nonsense. If a mortgage is unsustainable, the alternative of renting is far worse.
Now turn that around. let's say a 55 year old renter with €200k cash wants to live in a house worth €300k. The bank should be delighted to give him an interest only mortgage for €100k if he can comfortably afford the monthly interest or €250.
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