Borrowing at a later age? Why not?

In today's society, people buy real estate at an even older age. The so-called baby boomers take advantage of the low interest rates to purchase an investment property, a second home or a modern apartment in the city instead of the family home. A surprising phenomenon when you consider that a frequently used advice was that you should have paid everything off by the time you were entitled to pension, since your pension is often lower than your income. But what is the maximum age at which you can borrow?

There is none! There is nowhere a law that specifies when someone can borrow. Naturally, banks and lenders will take this into account in their underwriting policy. Someone of 35 years old will be more likely to make his payments until the age of 60 than someone of 65, for example. This is also called the 'biological risk'. This does not mean that borrowing at a later age is excluded, on the contrary! It is important that the customer is made aware of the fact that this may entail higher interest rates. The same applies to the outstanding balance insurance.

Different banks have their own policy regarding maximum borrowing age. For example, at ING, the limit is 85 years on repayment, at Argenta this is 77 years and Crelan 75 years. There are also banks where they evaluate this risk within reasonable life expectancy, namely BNP Paribas Fortis and KBC.

We work together with a company that uses 95 years (!) As the final age, so someone who is 70 years old can safely take out a loan at 25, so to speak.

Want to know more about borrowing at a later age? Contact us!

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