A prominent building society has announced a significant policy shift that will enable first-time buyers to secure mortgages with terms extending up to 40 years, potentially into retirement. The Nottingham Building Society is implementing this change to assist younger individuals in stepping onto the property ladder by spreading their repayments over a longer duration.
Extended Mortgage Terms to Age 75
The financial institution has removed its loan-to-value cap for lending into retirement, permitting borrowers to extend their mortgage term until they reach the age of 75. This adjustment means that the mortgage can run for up to 40 years or until the borrower turns 75, whichever occurs first. By offering these extended terms, the society aims to make homeownership more accessible to those who might struggle with higher monthly payments on shorter-term loans.
Supporting Diverse Financial Situations
On its official website, the Nottingham Building Society emphasised that mortgages are not solely for individuals following conventional life paths. The society highlighted its commitment to assisting first-time buyers who have not received financial support from family, as well as newly single individuals in their forties and self-employed professionals managing successful careers. To facilitate this, the building society is collaborating with the Mortgage Advice Bureau to provide tailored mortgage advice to both new and existing customers, helping them navigate the process and find suitable deals.
Eligibility and Financial Considerations
To qualify for first-time buyer relief in England and Northern Ireland, where purchasers pay 0% tax on the first £300,000, all buyers must be first-time buyers. Since April 1, 2025, the threshold for standard buyers has reverted to £125,000, meaning that properties priced above this amount are subject to standard residential Stamp Duty rates. The amount a borrower can secure depends on various factors, including annual income, outgoings, and credit score, with lenders typically offering between four to four-and-a-half times the annual income, though this can vary.
Expert Guidance Available
The Nottingham Building Society encourages potential buyers to consult with a Mortgage Advice Bureau adviser through their services to explore thousands of mortgage options and identify lenders that align with their specific financial circumstances. This move reflects a broader trend in the financial sector towards adapting products to meet the evolving needs of modern homebuyers, particularly in a challenging property market.
