“New Mortgage Lender MoCo Offers Later Life Loans: What You Need to Know”

A new entrant has made a foray into the Irish home loans sector, bringing with it a distinctive offering that has piqued the interest of industry professionals while also eliciting concerns. MoCo, a newly established lender supported by the Austrian bank Bawag, is disrupting the traditional paradigm by providing mortgages that can be repaid by borrowers until they reach the age of 80. This development is anticipated to introduce much-needed competition into a market traditionally dominated by AIB and Bank of Ireland.

Traditionally, most lenders stipulate that mortgages must be repaid by the age of 70. However, MoCo’s decision to extend this age limit has sparked discussions regarding the implications and risks associated with loans in later stages of life. The lender’s credit policy outlines a maximum term of up to 35 years, allowing borrowers the potential to continue repaying the loan until the age of 80.

According to Mark Coan, an advisor at MoneySherpa.ie, there is a burgeoning demand for mortgage terms that extend into later stages of life, which reflects the trend of individuals purchasing homes at later ages and the increasing life expectancy. Lenders are adapting to this shift by adjusting their age requirements, aligning Ireland with the practices observed in other markets. Nonetheless, the extension of mortgage terms for older applicants does not entail a relaxation of lending standards. MoCo and other lenders still necessitate applicants to demonstrate their capacity to repay the mortgage for the entirety of the term, even during retirement.

In response to apprehensions regarding the prudence of allowing individuals to repay a mortgage until the age of 80, MoCo has assured the public that its credit policy incorporates a comprehensive individual assessment for borrowers expected to be in retirement at any point during the mortgage term. This assessment takes into consideration ongoing income, affordability in retirement, and pertinent documentation from the borrower’s qualified financial advisor, if applicable.

The launch of MoCo’s later-life loans follows a discrimination complaint filed against another lender, Avant Money, for refusing a mortgage switch to a man over 70. The Workplace Relations Commission ruled in favor of the complainant, underscoring the evolving landscape of mortgage offerings and the treatment of older applicants in the lending sector. Avant Money has also garnered attention for its revised criteria, which now mandate single mortgage applicants to possess a minimum income of €80,000.

As the lending sector continues to evolve, it is imperative for borrowers to remain well-versed in the changing policies and offerings within the market. Whether it pertains to the emergence of a new entity such as MoCo or the amended criteria of established lenders, comprehending the repercussions of these changes is pivotal for making well-informed financial decisions. With the potential for increased options and flexibility in mortgage terms, borrowers stand to benefit from a competitive market that caters to their diverse requirements.