To be contemplating taking on a large mortgage in my 50's?

[MrsPatmore]

I think this will be our last chance to trade up property wise. Live in SE London. Joint salary 80K. Jobs very secure (public sector) but I'm worried about if we get ill etc. The mortgage would be 220K (would be 50% LTV) and would take us too age 70 but the plan is to downsize to the coast a couple of years before that so we would live in it for 17 years. Have good pension provision and savings for ds university should he wish to go but no house deposit for him (possible substantial inheritance but not banking on that.)

If times get tough, thinking we could get language students/lodger. I can also work weekends etc. Quite desperate to move.

Is there no compromise? Say a smaller house (but bigger than yours) for £150k mortgage which you could have a shorter term on? No chance to extend?
Although you earn good money and I should imagine the sick pay etc is excellent so might be ok.

If you have space for eg language students and can make even 1x extra monthly payment a year over payment, it will start to make a substantial difference to the length/amount of the mortgage. I would do it (though am not your age) - we’re taking on a similar sized monthly repayment mortgage but on a 30 year term which would take us to a similar age.

Due to my fairly recent marriage breakdown I am now looking at starting over on my own, in my mid 40s. Live in London with huge house prices and not able to move due to kids schooling and shared childcare arrangements with ex, It scares the crap out of me to be taking on a significant mortgage at my age on my own and no one to support if I get ill, made redundant etc.

Sorry realise I blurted and was not helpful at all!

I think you should stop thinking about it in terms of your ages. After all, age is just a number- some 50 yo's are on their last legs, some are young as anything. You have been told you qualify so age is no bar to getting a deal. If you can afford it and are happy to pay that rate for another 20 years or so, go for it. I would say the same to someone who was 40 asking the same question, or even 30. Mortgages are long-time commitments and personally, I can't see the difference between paying it off at 60, 65 or 70.

For illustration, I got a 35 year term at age 32 so I will only be 3 years younger when I repay mine than you will be when you repay yours. Nobody ever said anything to me about age and I fully expect to be working up until age 70 at least.

Get mortgage protection insurance and life insurance to make sure you have protection if things go wrong, and if they do, you can sell and downsize with the amount of equity you have.

It scares the crap out of me to be taking on a significant mortgage at my age on my own and no one to support if I get ill, made redundant etc.

Why? You're in your 40s, not 80s. The same would apply if you were mid-thirties- anyone can get ill or be made redundant or get divorced. In fact, statistically speaking, buying with another person is probably more of a risk due to the number of marriages ending in divorce, than the risk of buying on your own and losing your job. Yet many people think the first option is safer.
Go for it. I don't think you will regret it.

@ChangingStates
I'm in similar position. Recent marriage breakdown - potentially looking to buy stbexh out of the house as a clean break. If I can manage to extend term and keep payments the same I reckon I can manage but scares the hell out of me!

i would.
secure jobs and affordable on your salaries. if either made redundant you would get decent notice and payout.
we are the opposite really. self employed so prioritised clearing mgage. moved to the coast last year just ahead of youngest doing secondary school. i would take on another mgage in a heartbeat to get a nicer house, dh wont hear of it!

Just done exactly that in South East London (are you my neighbour 😁) My mortgage for me will finish when I’m 68 and is higher than yours - £270 I think.

Seems totally worth it. My place is great.

Language students really do bring in a decent income - it will help pay a huge chunk of your mortgage, though you might obviously have to give up some of your time to make them breakfast/dinner (not sure if everywhere is the same, or some you don't have to do that with). A friend of ours does it with multiple students at once and they've already paid off their mortgage within five years! (they also ate bare minimum food etc and didn't go out to help save even more money, but still, it was an amazing income they were getting).

I'm really sorry my first reaction feels quite intrusive and maybe a little judgy.

If you take home £5k per month and your mortgage is £750 pm thats a lot of surplus income. We take home £4k per month and I'm paying £1500 pm mortgage (which does include a very significant overpay) in your situation I'd be getting the new mortgage, trying to pay at least £2000 each month so the mortgage would be gone in 15 years and I'd still have £3k to live off which for me for a family of 3 would be ample. We have a family of 5. I get that its London so naturally more expensive but is it really that much more expensive?

Do it but repay early as much as you can.

That's ok Billybagpuss, I appreciate it seems a lot and I'd love to pay £2K a month to pay it off quickly. For some reason, barely a month goes by where there isn't a several hundred pound expense (school bus, car repairs, house repair etc) so I am very wary of over extending. Plus any move will take up every penny of our savings so we'd have to build that cushion up again before overpaying.

We have had a good life and will need to cut back on holidays/where we shop etc which isn't a great prospect but then I imagine us in a nicer house with a bigger garden and it won't seem like a hardship then. I think we'll go for it but look into the language student/ extra work thing in more depth too.

How long did it take you all for things to become easier? I guess inflation will ease things eventually but with Brexit, I'm not sure...

Paying a mortgage off early is not always possible, nor advisable.

I earn more in interest on my savings than my mortgage rate.

My mortgage does not have a pay off early facility anyway- only "payment holidays".

My initial reaction was no way. Then I looked at what my mortgage would be at 50 and it’s more. I’m in my 30s but most of my friends like me have taken out massive mortgages over a long time frame. I’d hope I’d be in a position to overpay so I didn’t have as much of a financial burden when I’m older. I guess the difference is that I’ve got 20 odd years of inflation that would hopefully make the sum seem relatively smaller by then.

Like a previous poster, you could probably pay more monthly as your mortgage payments would still be relatively comfortable compared to salary. Could you use a tax free lump sum from pensions to pay off some of the mortgage in a few years time or will you need that money for living?

If you can get someone to give you one it sounds like you have solid plans in place. 50%LTV gives you good equity and if you get lodgers in asap you can overpay on the mortgage and maybe get it paid off before retirement.

Banks will see you as higher risk as the mortgage will take you beyond retirement age, but as it's a low LTV they will still at least consider you.

Good luck!

My partner got a mortgage last year at age 45. He was keen to get back on the property ladder while he could still get a good deal on a mortgage.
I myself plan to buy something in a few years once my IVA clears, it should coincide with me turning 40 (Argh scary!) so I can have a 25 year mortgage :)

User, yes we were thinking that we could reduce the mortgage quite a bit in 14 years when dh pension is due using some of the lump sum. We should have paid over half of it by then. There may also be an inheritance too but don't want to bank on this as I would want the parent to use this for care home fees if necessary.

Sounds like you need the space now, what is to be gained by waiting?
Your property may take months to sell, property prices may go up and you will be older.