Especially when buying real estate
Older people feel ignored when it comes to lending
September 26, 2023, 3:36 a.m
You are as young as you feel. This often only applies until the day on which a pensioner wants to apply for a real estate loan. A study comes to the conclusion that many seniors perceive the blanket rejection of banks as discrimination.
Older people feel increasingly discriminated against when it comes to lending by banks. This is shown by a study by the Institute for Financial Services, which was available to the Germany editorial network. Accordingly, 55 percent of customers at 100 banks surveyed confirmed the existence of age limits when granting consumer loans, and 71 percent confirmed this for real estate loans. According to the study, the average age limit for granting consumer and real estate loans is 67 years.
According to the study, increasing branch closures also lead to discrimination based on age. 48 percent of survey participants stated that branches had been closed, mostly in rural areas. This makes access to advice more difficult, especially for older borrowers. Due to increasing digitalization, loan applications from older people are sometimes rejected without individual checks.
“Reasons for rejection should become more transparent”
“The institute’s study is a warning signal because it shows that older people are often no longer able to get loans across the board,” said the head of the federal anti-discrimination agency, Ferda Ataman, to the RND. Among other things, this could lead to serious problems for older homeowners who, for example, have to replace their heating system.
“Banks should of course continue to be able to check the creditworthiness of their customers in the future,” emphasized Ataman. But blanket rejections based on age are wrong. “Older people need the opportunity to get money with appropriate security.” Ataman suggested changing the General Equal Treatment Act to prevent blanket rejections of loans due to age in the future. “Consumers must have the opportunity to have their creditworthiness checked individually,” she said. In addition, banks should have to justify rejections of loans more transparently in the future.