In your forties? Mortgage lenders could decide that you are now too old to get a mortgage

Some of Britain's largest lenders are now cracking down on their lending criteria - and being in your forties could make you an 'older' borrower

If, like many first time buyers, it took until your thirties to finally step on to the property ladder, it may come as a surprise to hear that some lenders are putting borrowers in their forties in the ‘older borrower’ bracket.

Some of Britain’s biggest mortgage lenders, Halifax and Nationwide, have changed their lending criteria for customers who want to borrow into their retirement. The anticipated retirement age or state pension age (whichever is lower) now determines the point of retirement.

This has led to an increase in complaints from borrowers, some only in their forties, who are finding it difficult to secure mortgages.

A borrower’s state pension age depends on when they were born. For example, those aged between 37 and 45 have a state pension age of 67.

‘People who want to borrow beyond age 66 or 67 can find it very difficult, particularly if they have an interest-only mortgage,’ says Ray Boulger of mortgage broker John Charcol.

‘This can be true even for those who have a perfectly robust repayment plan. Lenders are assessing these borrowers on a repayment basis, so they could be turned down.’

The average age of first-time buyers is now around 30 – and it is expected to keep rising.

‘Often people now buy their first home well into their thirties and have a mortgage into later life,’ says Dominik Lipnicki of brokerage Your Mortgage Decisions.

‘It’s becoming normal for people to work until they are 75 or 80 and that trend is only going to go one way. Lenders are years behind in addressing this – they really must wake up and evolve.’

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