Aldermore enters later life mortgage market

The new range will feature two, three, five and ten-year fixed rate mortgages as well as a variable option, available up to 60% LTV for purchase and 75% LTV for remortgage.

Two-year fixed purchase rates start from 3.38%, rising to 3.98% for the ten-year fixed rate.

There will be no limit on overpayments and no early repayment charges on the variable product. On the ten-year fixed rate product, no early repayment changes will be applicable after five years.

Affordability is assessed on the income at the outset of the loan (if the borrower has not already retired) and actual or anticipated retirement income, with the lowest outcome determining the maximum loan amount.

The product will be available via selected distribution partners OpenWork, AToM, PTFS and Finance Planning; all of whom worked with Aldermore to develop the proposition.

Charles McDowell, Aldermore’s commercial director, mortgages, commented: “The house buying journey has changed markedly over the years. First-time buyers are more likely to be in their 30s or 40s, second stepping is delayed and retirement is later. It is our responsibility as a specialist lender to ensure we evolve our offering to address this change and we have worked hard to build a proposition that we are confident will meet this need.

“We also believe that a change is needed in the way we consider later life lending. The people this product is aimed at do not make up one homogenous group and shouldn’t be treated as such. Our simple to use bespoke later life lending calculator allow us to access each application on its own merits. Recent research we conducted reveals that 52% of those who would take out a product of this type would use it to travel in retirement whilst 51% would use it to do house improvements and renovations. In short, no matter what our customers want to achieve in later life, remortgaging is an easy way to unlock this capital and fund their plans.

“With our new later life lending proposition, we truly believe we can help more people with their borrowing needs, empowering them to live the life they want in retirement.”