More Australians Are Carrying Mortgages Into Their 60s — What Non-Bank Borrowers Need to Know

More Australians Are Carrying Mortgages Into Their 60s — What Non-Bank Borrowers Need to Know

New industry modelling released this week shows a growing share of Australian borrowers will still be repaying their home loans in their late 50s and 60s — driven by rising property prices, larger loan amounts, and later entry into the property market. For self-employed individuals and non-traditional borrowers, understanding how lenders assess loan terms and retirement serviceability is now more critical than ever.

Why Loan Terms Are Stretching

Several trends are converging to push mortgage debt further into retirement:

• Higher property values: Median dwelling values in major cities have more than doubled over the past decade, pushing average loan sizes significantly higher
• Later first purchases: The average age of first-time buyers has risen steadily, with many Australians not purchasing until their mid-to-late 30s or 40s
• Rate pressure: With the cash rate now at 4.10%, some borrowers are extending loan terms to manage rising monthly repayments

A 40-year-old taking out a standard 30-year loan today will be 70 when it matures. For borrowers in their late 40s or 50s, lenders — particularly the Big Four banks — increasingly require evidence of a retirement income plan as part of the lending assessment.

How Banks Assess Serviceability to Retirement

APRA's prudential guidelines require lenders to assess whether borrowers can continue servicing their mortgage in retirement. For salaried employees, this is typically demonstrated through superannuation projections.

However, self-employed borrowers, small business owners, and new migrants often lack this kind of documented long-term financial history. This is one area where traditional banks frequently decline applications from otherwise creditworthy borrowers — particularly those aged 45 and above with irregular income.

Non-Bank Solutions for Mature Borrowers

Non-bank lenders like MPFG Capital assess applications using a broader set of criteria. For borrowers over 50:

• Asset-backed lending: Property equity, business assets, and investment portfolios can support serviceability assessments in lieu of superannuation projections
• Alt Doc income verification: BAS statements, accountant letters, and business bank statements replace payslips
• Bridging and interest-only structures: For borrowers approaching retirement, short-term bridging loans or interest-only periods may provide flexibility during transition phases

The fundamental difference is that non-bank lenders take a holistic view of the borrower's financial position — not just their PAYG income and super balance.

What Chinese-Australian Borrowers Should Know

Many Chinese-Australian borrowers face a compound challenge: self-employment income that is structured differently from conventional Western employment models, overseas assets that are difficult to document under Australian standards, and a cultural preference to be debt-free before retirement.

MPFG Capital's experienced advisers understand these dynamics and can structure loan solutions that respect both the client's timeline and the lender's risk requirements — including Alt Doc products, bridging loans, and short-term private funding structures.

FAQ

Q: Can I still get a home loan in my 50s in Australia?

A: Yes. Both bank and non-bank lenders can approve loans for borrowers in their 50s. Non-bank lenders like MPFG Capital often offer more flexible assessment criteria, particularly for self-employed applicants.

Q: Do lenders require a retirement plan as part of my loan application?

A: Major banks typically require evidence that you can service the loan in retirement, such as super projections. Non-bank lenders may accept alternative documentation including asset statements and business income evidence.

Q: What is an Alt Doc loan and how does it help mature borrowers?

A: An Alt Doc (alternative documentation) loan allows borrowers to verify income through BAS statements, accountant letters, or business bank statements — rather than payslips. This is especially useful for self-employed borrowers who may not have consistent salary records.

Q: What if my overseas assets are not easily documented?

A: MPFG Capital has experience assessing borrowers with overseas assets and income. Our advisers can guide you through the documentation process for Australian lenders.

*This article is general information only and does not constitute financial advice. Loan eligibility and terms vary by individual circumstances.*