When you are mortgage planning in your 30s and 40s you are doing so with the expectation of paying off the 15- or 30-year loan term before you die. It may come as a shock then to learn that there is actually no upper limit on when you can qualify for a mortgage and that the Equal Credit Opportunity Act actually prevents discrimination against mortgage applicants based on their age.
The market of borrowers looking for a mortgage aged 65 or older makes up around 10% of all mortgages originated in the US on a yearly basis. There are other rules that disqualify some potential senior borrowers – like no longer working full time – but even a lack of steady work (due to retirement) can be offset. If a senior has dividends, stock options, or even if their pensions and social security benefits are strong enough, then a mortgage opportunity is out there for those looking for late-life mortgage planning.
While not discriminating based on age is only fair, it can also throw up some ridiculous stories. One example of this comes out of Trinity, FL. Here, a 97 –year-old woman came in to enquire about a mortgage. She qualified for the loan and it is noted that older borrowers can qualify for money that will expire up to their 130th birthday.
Mortgage planning is usually stressful for the borrower. In these cases though, it would seem that the mortgage would be much more stressful for the bank and whoever is insuring the loan. Another story is of a jumbo mortgage that was given to a qualifying 83-year-old man in Manhattan, NY. This mortgage was for an astonishing $1 million over 10 years, a much shorter loan period but still one that assumes the borrower lives to be 93 years of age.
The takeaway here is that you are never too old to buy a house and qualify for a mortgage if your financial status is positive. While buying a new house as a senior is never going to be the right move for everyone, there are people who are looking for that last move in life. If that is the case with you then go about your mortgage planning and speak with an advisor to see if you could start fresh one more time.
Article by Vital Guidance