2023-09-10 06:03:17
Once retirement has arrived, it is difficult for a person to want to get into a mortgage, but there may be personal circumstances why a retiree waits until this phase of their life to buy a new home, a goal that can be complicated, depending on various factors.
It must be taken into account that not everyone retires at the same time. The general rule indicates that the retirement age is 65, but it depends on the year in which one retires and the number of years that one has contributed, this figure may increase. Likewise, depending on specific circumstances, you can request partial, early, flexible retirement, etc. This means that this moment does not come at once for everyone.
When retirement comes, people usually have some purpose in mind, a goal they want to achieve, but… What happens if a retired person’s idea is to buy a home?
Are there mortgages for retirees?
Normally acquiring a property usually involves taking out a mortgage. As it is special financing, very specific requirements must be met, something that could affect retired people.
The first thing to keep in mind is that there is no mortgage for retirees as such, unlike other age groups such as young people, who do have loans adapted to their needs. Therefore, these people opt for a standard mortgage.
In this type of financing, one of the conditions that entities usually set is that, when the mortgage is completed, the holder of the mortgage must not be more than 75 years old. It is a way for the bank to ensure that the debt will end up being paid off.
Therefore, if a person is 65 years old and needs to apply for a mortgage, they will not be able to opt for one with a repayment period of more than 10 years, since in that case they would cross the barrier of 75. This implies that the payment they would have which to assume could be much higher than expected.
A much larger fee
Using the installment simulator from the iAhorro mortgage comparator, you can better understand the increase in installments that may entail going from a 30-year mortgage to one of 15. In the case of a fixed mortgage of 200,000 euros for 30 years with a TIN At 3.25% (the lowest on the market at the moment), the monthly fee remains at 870.41 euros per month. If the repayment period is reduced to 15 years, the fee would rise to 1,405.34 euros per month, 534.93 euros more.
Following this example, with a 30-year mixed mortgage and an interest rate of 2.55% TIN, the monthly payment would be 795.45 euros during the fixed tranche. By lowering the repayment period to 15 years, the fee increases by 40% to 1,338.45 euros.
For its part, the installment would be 778.70 euros with a 30-year variable mortgage and a TIN of Euribor +0.49%. By reducing it by 15 years, the user would have to assume a monthly payment of 1,170.16 euros, 391.46 euros more.
The data presented indicate that in all cases the increase in the quota is notably higher. It must be remembered that the Bank of Spain recommends that the monthly payment of a mortgage does not exceed between 30% and 35% of the owner’s income, which means that the user must dedicate more income to pay the mortgage in case it is has to be returned in 15 years.
In short, there is no specific law that does not allow retirees to request a mortgage. However, the conditions are toughened due to its age and the risk that the bank assumes.
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