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ING now wants income proof from 68

ING Direct is now requiring evidence of post-retirement income from borrowers whose mortgage term extends beyond age 68.

Previously, the company would conduct a mortgage affordability assessment based on current income up to 75, as long as the mortgage was paid off in full by then. Now if the mortgage term extends beyond 68, evidence of post-retirement income will be required and the lower of the retirement income or current income will be used to assess affordability.

A spokesman says the decision to lower the age was taken partly as a result of proposals in the mortgage market review on lending into retirement and as part of a wider review into how the firm assesses affordability.

The FSA is clear it does not want to restrict lending into retirement but the mortgage market review proposes that lenders must verify “as far as possible” income into retirement and whether the mortgage will remain affordable for the borrower.

London & Country associate director of communications David Hollingworth says: “Lending into retirement has been under close scrutiny from lenders for some time, partly as a result of the MMR, and lenders have definitely tightened up in this area. Lenders must bear in mind that state retirement age is starting to creep up and must adapt to those conditions.”

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