Getting a mortgage after age 57: What’s possible and what’s not?

Getting a mortgage after age 57: What’s possible and what’s not 

If you’re younger than 57 and earning a solid income, getting a mortgage is usually pretty straightforward. But once you blow out the candles on your 57th birthday, banks immediately start looking at your financial situation differently. From that point on, they not only consider your current income, but also look at what your pension income will be later. This often means you can borrow less than expected and sometimes much less than you had hoped. So, how does it work? And how can you handle this wisely and strategically? This is exactly why many people start exploring a senior citizens mortgage.

Why can you borrow less after age 57? 

From age 57 onward, lenders assess not just your present income, but also your expected retirement income. And unfortunately, the average Dutch pension today is significantly lower than it was for previous generations. In most cases, your projected pension will be much less than your current salary. As a result, your borrowing capacity drops dramatically after age 57. There’s really no way around it. 

Note: In practice, we see borrowing capacity shrink significantly after age 57. So, if you’re considering moving, renovating, or increasing your mortgage by tapping into your home equity for example, to fund a world trip, buy a camper, gift money to your children, or simply enjoy a more comfortable lifestyle, it’s essential to arrange this before you turn 57. Otherwise, you run the risk of not being able to borrow what you had hoped, and your plans may no longer be feasible. 

This is not just a cautionary tale, the lending criteria used by banks are strict and clear-cut. There is a definite “before and after 57” situation, and the difference is usually significant. 

What if you plan to keep working after retirement? 

Many people assume that continuing to work after retirement will give them more mortgage options. Unfortunately, that’s not how it works. Banks only look at your official pension income and what you’ll still accrue before retirement. Any additional income, such as part-time earnings, freelance work, or proceeds from selling a business, is not taken into account. 

The phrase “my business is my pension” may sound familiar to many entrepreneurs, but the banks don’t recognize it, and they certainly don’t factor it into their assessments. 

Important to know 

Even if you’re certain you’ll be able to afford your mortgage after retirement, banks won’t consider it. So, if you’re planning to increase your mortgage or unlock home equity, it’s not just smart, in many cases, it’s absolutely necessary to apply for a mortgage in the Netherlands before turning 57. 

It’s entirely possible that you have a solid and responsible financial plan for your post-retirement years. But the bank doesn’t see it that way, and they won’t factor in your personal reasoning. That’s why it’s important to be both realistic and strategic in how you approach this. 

Not sure how much you could borrow after 57? 
Download your pension statement at www.mijnpensioenoverzicht.nl and review it with your mortgage advisor. 

Mortgage options after age 57 require careful planning and timing. A mortgage advisor can help you assess your pension income and explore the right solutions before it’s too late.