After 60 years it is sometimes difficult to find solutions to finance a project. Indeed the condition of age is a very important criterion to qualify for a loan. Depending on the amount of the latter the duration of the repayment may be longer or shorter and from a certain age the risk of default increases. However, funding a project after 60 has become more accessible even if sometimes the path to obtaining the loan can be fraught with difficulties.
Why is it difficult to get a loan?
You want to realize a project like the purchase of a new car or a second home? However, getting a loan when you are a senior is difficult and banks are often reluctant to grant more than 65 years; they often require that the whole be repaid after 70 years. In addition, retirement pensions are often lower than the wages received during periods of activity, which further increases the risk of default.
Consumer credit is generally easier to access for seniors in view of the generally low sums. Many banks have credit offers for older people. These loans are often less risky since the sums are low and therefore refundable quickly. In addition, older people have a more stable life because they have a fixed income and are less subject to the problems of unemployment.
However, consumer credit can be limiting when one wants to obtain a larger loan to finance a larger project such as the purchase of a car or a second home.
The question of disability-death insurance
To obtain a larger loan repayable over a longer period, banks often ask for death and disability insurance. However, this can be very expensive since providing such insurance to a senior implies a very high risk of loss.
These insurances are becoming more and more accessible because banks allow individuals to subscribe to their insurance with a delegation of insurance and a different organization from their bank. This allows you to access insurance more easily and to obtain other types of loans to finance a project such as the purchase of a second home.
Other guarantees may be requested such as bonds or mortgages. These cover the risk of non-payment while the insurance protects you and your loved ones in case of disability or death.
Towards greater accessibility of senior loans
Nowadays, with the progress of medicine, it seems that access to larger loans becomes possible for a senior audience. Indeed life expectancy tends to increase which encourages banks to give credit to a senior and therefore to postpone the maturity date of the loan. In addition, as mentioned earlier, the issue of insurance is no longer so much a problem and becomes more accessible. However, it is important to provide guarantees in terms of income, mortgages or bonds in order to convince banks that are more reluctant than facing younger applicants. They can legally refuse a loan application based on an assessment of the risk and the conditions specific to them.