(1888PressRelease)
May 13, 2006 -
According to recent survey one in every six pensioner are still paying for mortgage. A survey by the Scottish Windows found that 1.76 British pensioners are yet to free themselves from mortgage liabilities. And most of them still owe on am average more than ₤45,000 each on their mortgage debt.
The research conducted by the YouGov last year , found that one third of those who are still paying for a mortgage owe on an average of more than ₤50,000, while one in every ten have more than ₤100,000 outstanding debt that needs to be cleared.
The online survey conducted by YouGov, over 1472 people aged above 55, also came up with the fact that individuals with higher income will have to carry on with their mortgage liabilities till their retirement.
Four of every ten persons aged between 55-65 and having an annual income of ₤40,000 or more still owed money to the lenders. And only 18% of them having an annual income of ₤20,000 still owed on there home.
Scottish Widows said “the growing number of pensioners still paying off mortgages is placing increasing pressure on their limited retirement funds”.
The bank also added that the increase in the level of pensioner’s debt is due to the fact that of people are now willing to take loan in the later stage of their life and then using that equity on their homes as their source of income after there retirement.
The trend may continue as more and more homebuyers tend to go for home buying before the age of 35, as claimed by Scottish Windows. As a result, they may have to utilize the funds deposited in their pension funds in order to cover their monthly mortgage payments, the bank said.
“Recent surveys have shown that by the time they retire most of them have outstanding on their property which add pressure to there hard earned retirement fund” said Murdo McHardy, head of product development and marketing at Scottish Widows.
He added “It is important for those people who will be reaching retirement in the next few years, and still have debt outstanding on their mortgage, to consider how best to prepare themselves for the eventuality of having to juggle their debts on a reduced income when they stop working.”
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