Halifax Intermediaries has lowered the maximum working age from 75 to 70 on selected lending products.
This change will apply to remortgage applications where borrowers are looking to raise additional capital, as well as both purchase and remortgage applications where there is an issue with the overall credit profile of the borrower, or level of credit score.
Halifax says these changes were made as part of a regular review of its lending criteria. The company stress that it will continue to use a maximum working age of 75 for the majority of its customers and this change would not apply to product transfer of further advance applications.
It advised intermediaries that if a term past 70 years of age is selected for an application that has this new maximum working age, a corrective action message will show at the DIP stage.
Halifax Intermediaries stressed that while no further changes had been made customers need to consider the sustainability and plausibility of working to their anticipated retirement age.
This change applies to applications starting from 18 March.
Evelyn Partners financial analyst Adrian Lowery says: “Having raised the limit to 75 only last summer, the lender is apparently reining back on lending that is now perceived as risky.
“For many older borrowers, and particularly those approaching a loan application, this might feel like the goalposts are being shifted back to where they were before mortgage rates started ballooning.
Lowery adds: “While many such borrowers will be confident that they can either shorten the loan at a later date, or continue repayments beyond 70 — either because they will keep working or have a good pension in place, or both — the Halifax would probably argue that they need to have responsible criteria in place.
“There’s no doubt that as property prices remain very high and as we are very unlikely to return to the super-low mortgage rates enjoyed until a couple of years ago, many households will have to revise either their homebuying demands, their cash-flow expectations or possibly even the date and style of their retirement.”
