Pensioners receive an old-age pension from the statutory pension insurance and often a development pension and possibly an additional payment from the private pension insurance. The importance of company pensions is also increasing. The previous retirement age of 65 is gradually being increased to 67, and at the age of 70 a pensioner has been receiving retirement income for a number of years.
Lending to pensioners over 70 years of age
Many financial institutions are reluctant to grant loans to a pensioner over the age of 70 because they consider the risk of default to be high. The risk of death during the loan period no doubt increases with the age of the borrower. This also applies to the need for long-term care, which increases accommodation costs. For this reason, banks often require installment protection insurance for a loan for a pensioner with over 70 years of life experience. Alternatively, proof of sufficient life insurance for the repayment of the loan or the default guarantee of the future heir is possible. Today’s generation of pensioners is more responsible than many young people in financial matters, so that the personal willingness to repay loans is higher than average for borrowers aged 70 and over and the inevitable greater credit risk due to natural factors can be partially offset. The biological risk means that financial institutions prefer a short loan term for a loan for pensioners over 70 years of age.
The pensioner’s income
Income includes regular incoming payments. Financial institutions frequently frequently equate to monthly, so that they do not take into account additional private pensions that are paid out every two or three months, although the monthly amount can easily be calculated. Income from a rental is in most cases taken into account in the household bill. A possible additional income from a job that is still carried out usually does not count financial institutions in the income for a loan for pensioners over 70 years, since the probability of the job being done during the loan period is high. On the expenditure side, banks take the living situation into account, making it easier for retirees to own a home.