It’s weird but true: Not much is known about senior loans. Because we ourselves were curious about how a senior citizen loan differs from other loans and what you have to meet to be able to take out this loan, we have been informed here and there. And of course we do not want to keep this information to ourselves but would like to share it with anyone who is planning to apply for this type of loan for the elderly.
What kind of loan is the senior citizen loan?
You can only take out most senior loans when you are 60 or older. You must repay this loan before your 74th birthday. Previously, these loans had to be repaid before the age of 68, but because people are getting older, the banks have changed this. The age limit between banks also differs considerably.
For the older people it is much harder to borrow. Banks apply much stricter conditions for this target group. Why is that the case? Banks have much less certainty with older people that they can actually pay off the debt. Not only is the chance of older people of course dying, the income will also drop when they retire.
Less money remains to redeem. Incidentally, it differs per provider how much you can borrow as a person over 60. With a single bank you can borrow up to 50,000 euros while other lenders are sparing in providing money.
Choose from multiple credit types
Besides, not all senior loans are personal loans. However, the conditions usually differ per bank or lender, and the same applies to the interest rate.
However, as a senior citizen, do you not want to take out a personal loan but a revolving credit? Then keep in mind that you are no longer looking for a pin in the haystack, because the banks have become a lot more flexible compared to lending money to the elderly.
Special loans for seniors is a good development
In our humble opinion, it is a very good development that it is possible for more and more elderly people to be able to borrow at a later age.
Now that there are more borrowing options, it is also possible to transfer existing loans or to merge them into 1 large loan. In this way, seniors can also save money on old age by taking over expensive loans or combining several small loans. Seniors can also take out a mortgage at this time. there are also special conditions attached to this.
The older you are, the less you can borrow
At all regular banks it applies that you can borrow less as the age progresses. A senior citizen will be able to borrow less with a senior citizen loan than someone aged 62 to name a few.
It should be noted that age is taken into account in the above table. The loan runs once then it must be phased out for a certain age, usually this is 5 years. With a revolving credit, it is no longer permitted to withdraw repaid amounts at the maximum age at the start. In this way the credit is gradually reduced.
Seniors are very welcome at the banks
The elderly have the advantage that they are classified as good payers, whether this is justified or not, let’s not mention that. The lenders are increasingly realizing that the population is getting older and that the group that can now be classified as ‘older people’ generally pay their bills and loans well.
With this knowledge, providers pay less interest than with the younger target group. So it could even mean that interest rates are going down slightly for the elderly group because of the lower risk. It varies greatly per provider which interest is charged. In this case too, it is certainly important to keep comparing and requesting multiple quotes.