The new range features two, three, five and 10-year fixed rate mortgages and a variable option. Rates start at 3.38% for a two-year fix at 60% LTV and go up to 4.28% for a 10-year fix at 75% LTV.
There is no limit on overpayments and no early repayment charges on the variable product, which has rates of 4.18% at 60% LTV and 4.48% at 75% LTV. Aldermore says this is to ensure customers can borrow what they need and pay it back at a manageable rate.
On the 10-year fixed rate product, no early repayment changes will be applicable after five years. Affordability is assessed on the income at the outset of the loan (if the borrower has not already retired) and actual or anticipated retirement income, with the lowest outcome determining the maximum loan amount.
Aldermore has created an online calculator so brokers can assess their client’s affordability. The decision in principle will be based on the information entered.
Charles McDowell, Aldermore’s commercial director, mortgages, commented: “The house buying journey has changed markedly over the years. First-time buyers are more likely to be in their 30s or 40s, second stepping is delayed and retirement is later.
“We believe that a change is needed in the way we consider later-life lending. The people this product is aimed at do not make up one homogenous group and shouldn’t be treated as such.
“At Aldermore, we are passionate about supporting those people who would typically be excluded from mainstream lending. Thanks to our human approach, we are able to consider each case on an individual basis, ensuring we can give the customer the support they need. With our new Later Life Lending proposition, we truly believe we can help more people with their borrowing needs, empowering them to live the life they want in retirement.”
The product will be available through multiple partners that cover a broad range of distribution channels – OpenWork, AToM, PTFS and Finance Planning. They all worked with Aldermore to develop this proposition.