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Dudley scraps upper age limit for mortgage borrowers

  • 07/01/2016
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Dudley scraps upper age limit for mortgage borrowers
Dudley Building Society has removed all upper age restrictions on its mortgage range in a bid to help older clients who may not qualify to buy, downsize or remortgage.

The society made the decision to amend its criteria to ensure all its borrowers were treated equally and to eradicate the possibility of discrimination on the grounds of age.

Jonathan Moore, head of credit at Dudley Building Society, said: “For too long older borrowers have struggled to find mortgage availability and those options which did exist generally treated these borrowers as second-class citizens by forcing them to borrow from a limited range.

“We’d always look to see whether we could assist in markets which appear to be underserved and it plays very well into our roots as a building society, which were formed to help borrowers who were unable to access mortgage finance,” he said.

The society believes it has a sense of duty to assist parts of the market where people are being unfairly and unreasonably prevented from fulfilling their finance needs.

Moore added that the Dudley considers older borrowers to offer no more risk than younger ones, providing that underwriting was carried out by professional underwriters.

“Older borrowers have got a number of things going for them. They’ve got life experience managing their finances, admittedly some of them haven’t done it very well, but generally speaking as people go through life they gain skills and experience which should assist them when they’re older. I would expect on the whole this group of borrowers will perform very well,” he added.

Comparing the risks between younger and older borrowers, Moore said younger borrowers face a greater risk of losing their jobs.

Moore said he would not be at all surprised if at the end of the year there were more lenders catering to the older borrower market.

In early November last year, the Building Societies Association (BSA) promised to lead a review into age caps on mortgage lending within the mutual sector.

Speaking then, Paul Broadhead, head of mortgage policy at the BSA, said the industry risked having a large group of people whose financial needs were not met if it did not start to consider how demand for a mortgage might change.

Some other lenders have expressed interest in or have taken steps towards catering to older borrowers.

In May last year, Fleet Mortgages raised the upper age limit at the end of the mortgage term to 85 for buy-to-let investors.

In August, Legal & General expressed interest in developing a hybrid product combining features of a standard residential mortgage with aspects of a lifetime mortgage.

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