Over 40s face ‘unjustified’ discrimination in mortgage market
Freezing the over 40s out of the housing market is another example of unjustified age discrimination. according to Paul Green from Saga.
Commenting on a report by the Intermediary Mortgage Lenders Association (IMLA), Green said that “banks need to move with the times and base lending decisions on ability to pay not on arbitrary age limits”.
He said: “The latest news that even those in their 40s face difficulties with obtaining or moving their mortgage deals because of their age shows just how crazy financial firms have become.
Green added that people in their 40s can already see their parents having to work to far beyond 65 so the chances of them being able to settle into retirement at such a youthful age would be unheard of.
“Freezing them out of the mortgage market or leaving them in expensive deals is another example of unjustified age discrimination.”
The report by IMLA said lenders were reluctant to lend to customers beyond their retirement through a fear of a future clampdown by the regulator. It cited a lack of clarity in the Mortgage Market Review (MMR) rules for forcing mortgage lenders to impose lower maximum age limits on their products.
Speaking at the The Mortgage and Protection Event in Birmingham last week Matthew Wyles, senior adviser at Castle Trust, said lenders needed to stop treating borrowers who had reached their 55th birthday as if they had two heads.
He said: “I think the prize will belong to the brave, those guys who are willing to understand exactly where the FCA are coming from and start to break some of the rules that have evolved, some of the coral reef that lenders have constructed around themselves, which offers a big opportunity there.”