More mortgage for the elderly
The borrowing capacity for the elderly will increase in 2018. They can get more mortgages for purchases and transfers next year. View our calculation example.
Income test is often a stumbling block for the elderly
The mortgage standards for 2018 are known. The most striking is the maximum mortgage of 100% of the home. From this year onwards, therefore, no more can be borrowed than the property is worth. This is particularly disadvantageous for starters. At a later age, savings or repayments are often made on the mortgage and this measure will have less impact.
The stumbling block for the elderly is the maximum mortgage based on income. Lenders already take the (lower) income after retirement into account 10 years before retirement date, which means that they can borrow less. Plans of the elderly to buy a home or take out a mortgage often fail the income test.
This is of course extra acidic if savings can be achieved through purchases or transfers.
More customization for the elderly
This was the reason for the government and lenders to set up the Customization Platform. Bottlenecks in mortgage lending are discussed in this. This year we have already seen the first initiatives for more tailor-made solutions for the elderly, for example with the renewed redemption mortgage.
We expect more lenders to come up with initiatives in 2018. The government calls on lenders to pursue broader acceptance policy for the elderly, but does not want to make this compulsory. Minister Plasterk of the Interior and Kingdom Relations has indicated that he would like to leave room for a stricter acceptance policy, for example for price fighters.
The elderly can borrow more
In 2018, borrowing capacity for the elderly will increase on a number of points. We call them and show with a calculation example how much this makes a difference.
Borrow more with a short-term mortgage
A mortgage shorter than 10 years will be tested in 2018 for the current mortgage interest rate instead of the fictitious test interest rate, provided that it is repaid. Elderly people whose mortgages have already been running for 20 years and want to purchase or re-borrow can borrow more.
NHG Broader Standards for the Elderly
The NHG has broadened its standards, especially for the elderly. It is now possible to test the mortgage against current burden from 10 years before the state pension age. This allows you to borrow more than testing for the fictitious test load. Read more about the conditions with these broader NHG standards.
In addition, with a house up to 265,000 euros in 2018, you will be eligible for a mortgage under the National Mortgage Guarantee. For an investment in energy saving measures, the cost limit for NHG even rises to 280,900 euros.
In 2018, therefore, more people will be eligible for an NHG mortgage. The guarantee is therefore also interesting for the elderly. In addition to extra security in the event of payment problems, many lenders provide an interest discount that can be as high as 0.6%. For a NHG mortgage you pay a one-off premium of 1% of the mortgage sum.
Borrow more with two (pension) incomes
Double earners can borrow more in 2018. The second (pension) income may count for 70% for the mortgage next year. Now this is 60%.
Example calculation lending capacity of the elderly
The above changes can increase the borrowing capacity of the elderly by thousands of euros. We have made a calculation example for the maximum hypothesis of a retired couple:
- Applicant A’s income: € 35,000
- Applicant B’s income: € 16,000
- Fixed-rate period 10 years (No NHG)
- Mortgage interest: 1.80%
- 2017: € 301.294
- 2018: € 319.017
Calculate how much you can borrow under the current borrowing standards.