Credit Check
Retiring to the UK after years overseas brings a different set of mortgage considerations to a typical residential purchase. Instead of employment income, you may be relying on pensions and investments. You may also be applying later in life, meaning the length of the mortgage term becomes particularly important.
Can I Get a Mortgage After Retirement?
Yes. Being retired does not automatically prevent you from getting a mortgage. The key issue is whether the lender is satisfied that you have sufficient, reliable income to support the mortgage for the proposed term.
This can include UK State Pension income, private or workplace pensions, overseas pensions and certain other forms of sustainable retirement income.
How Is Pension Income Assessed?
Lenders generally want evidence that your pension income is established and ongoing. For UK pensions, this may be relatively straightforward. Overseas pensions can introduce additional considerations because the income may be paid in a foreign currency and the lender may need further documentation. The source of the pension and how reliably it can be demonstrated will also both be relevant.
Does My Age Affect the Mortgage?
Yes. Lenders typically have maximum ages by which a mortgage must be repaid. These vary significantly, so being 65, 70 or 75 can make a substantial difference to the term available. For example, someone applying at 70 with a lender requiring the mortgage to be repaid by age 80 would have a maximum term of 10 years. A shorter term can mean significantly higher monthly payments.
What About Retirement Interest-Only Mortgages?
For some borrowers, an interest-only mortgage can make sense because it reduces the monthly payment. However, lenders generally require a credible repayment strategy for the capital. This could involve the future sale of another property or another clearly identifiable asset. Simply expecting to sell something at some point in the future may not be sufficient.
What If I Still Work Before Retiring?
Timing can make a difference. If you are still working overseas but intend to retire shortly after returning to the UK, applying while you remain employed may result in a different assessment from applying once your pension income has become your primary source of income.
There is no single answer as to which is better, so it can be worth reviewing your options before your retirement date.
Can I Use an Overseas Property as Part of My Plan?
Potentially. Some returning retirees use the proceeds from selling an overseas property to fund a UK purchase or reduce their mortgage. If the overseas property is being retained and rented out, however, the associated mortgage and rental income will need to be considered.
Frequently Asked Questions.
- Can I get a UK mortgage if I am already retired?
Yes, subject to lender criteria, income and affordability. - Can overseas pension income be used?
The lender will need to verify the income and may apply specific criteria because it is paid overseas. - How old is too old to get a mortgage?
There is no single maximum age across the UK market. Individual lenders have their own maximum age and term requirements. - Can I get an interest-only mortgage in retirement?
Potentially, provided you meet the lender’s criteria and have an acceptable repayment strategy. - If you are planning to retire to the UK and need a mortgage, the earlier you understand your options, the easier it can be to plan the move. Get in touch with details of your income, assets and retirement plans and we can help you explore the options available.
Liquid Expat Mortgages
Suite 4b, Link 665 Business Centre,
Todd Hall Rd,
Haslingden, Rossendale
BB4 5HU
Phone: 0161 871 1216
www.liquidexpatmortgages.com
Any media enquiries please contact Ulysses Communications.
sergio@ulyssesmarketing.com
+44 161 633 5009
