With borrowing rates still attractive, all categories of borrowers are interested. Among them, many seniors want to plan to finance a real estate purchase. But it can be difficult to borrow after age 50, just as when there is an increased health risk. Indeed, loan insurance represents a barrier to their accessibility to the property.
How to borrow after the age of 50
Even after the age of 50, it is possible to benefit from a mortgage on favorable terms because the average loan rate over a 15-year repayment period is currently 1.35%.
If you are a senior and already have wealth, banks can generally be more enthusiastic about unlocking solicited funds for you than for a young borrower starting their career or without a CDI.
It should be noted that the over-50s account for nearly 15% of the total number of applications for mortgage loans and broker insurance.
However, the situation may be more complex for people over the age of 60, because of their retirement, usually involving a decline in income.
In order to compensate for this, some banks may offer “tiered” loans, characterized by greater repayment before retirement, and then with reduced maturities after retirement.
Other banks may agree to postpone some monthly payments or to reduce them downward in order to adapt well to the resources of the borrower.
Loan insurance: a brake for seniors?
The main brake on access to loans for over 50s is the borrower insurance. For insurance companies, age increases the risk of health problems and death, which significantly increases the cost of insurance. It is generally a question of the application of surcharges following the answers given in the health questionnaire and additional examinations revealing health problems.
Also, the death guarantee is no longer effective after the age of 75 years. And it is most often after the age of 65 that disability and disability benefits no longer apply.
Use the delegation of insurance to access the loan in the best conditions
By choosing to resort to the insurance delegation, ie by taking the time to play the competition between the insurers and the group insurance contract presented by the bank, in order to take out individual insurance with an external insurer, it is possible to save money and/or obtain an extension of the guarantees.
Some insurance companies may indeed agree to cover risks that are excluded from group insurance contracts or may even offer to extend the coverage of the death guarantee at the age of 90.
Finally, know that from January 1, 2018, borrowers will have the opportunity to terminate their loan insurance contract on each anniversary date of subscription.