home loan aged in 40s

I am applying for my first home loan aged 44. I'm concerned this might be an issue. My broker originally thought of a 30 year loan, but has said that maybe because of my age it would need to be a 25 year loan.

I'm aware that lenders are concerned about the 'exit strategy'. For a 30 year loan, I would be 74 at the end of the loan. I am buying an apartment in inner Sydney, so I envisage that by age 70 I would sell the property and buy in regional Australia where I could get a house for half the price. Would this be an acceptable 'exit strategy' ?

 

Downsizing is usually an excellent exit strategy. I am confident it will work for you. To further improve your chances, add specifics on location, current price, number of bedrooms of the place that you would look to downsize to.

 

Most lenders will accept a proposed retirement age of 75. A 30 year loan term shouldn't be a problem.

'Downsizing' isn't an ideal exit strategy from a lenders perspective, it makes some assumptions future property values. I agree they're likely to come true, but there's nothing guaranteeing that prediction 100%.

If pressed to retire by age 70, simply calculate the loan remaining at that time (assuming a regular P&I schedule) and what your super balance would be (assuming minimum 9.5% contributions) over the next 26 years. That alone would get it over the line, but then pad it out with the kids leaving home granting you a higher disposable income later on. I'm sure you won't need to downsize to own your home by age 70.

I suspect your broker isn't great at thinking outside the box just a little. Last week I got a 20 year loan approved for a 63 year old simply playing out out the figures of projected loan and super figures at retirement age.

 

I've had 30 year loans approved for people much older than you so it's certainly possible.
Some lenders will not accept the sale of your existing owner occupied property as a suitable exit strategy so that needs to be considered in any lender selection.
They will want to know your total asset position such as how much super do you have now, projections for future super estimates will help.

 

Have used downsizing plenty of times working on current property value and ammortised loan amount. Just include examples of advertised properties within the area that would suit.

 

Super can be used to pay out future debt and is reasonably simple to project how much will be available in 3 decades, based on conservative past performance.

 

There is a few ways to mitigate the risk of age, such as super and also what other asset you have.

Some lenders are hard a33e3 with age and want want full on exit strategy and some are less discriminative.

But seems like your answer would be downsizing/relocation