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Can a 70 year old get a 30-year home loan?

Can a 70-year-old choose between a 15- and a 30-year mortgage? Absolutely. The Equal Credit Opportunity Act's protections extend to your mortgage term. Mortgage lenders can't deny you a specific loan term on the basis of age.

rocketmortgage.com - Senior Mortgages: Home Loans And Refinancing After Retirement

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There’s no age limit when it comes to getting or refinancing a mortgage. Thanks to the Equal Credit Opportunity Act, seniors have the right to fair and equal treatment from mortgage lenders. So, what makes getting a mortgage different as a senior? It all comes down to motivations and finances.

Your Reasons For Buying Or Refinancing

If you’ve lived in your current home for many years or have your mortgage paid off, you might wonder why you’d even want to move or refinance your home. Does it make sense to go through the entire refinancing or home buying process again?

For many seniors, the answer is yes. Your reasons may vary, but many seniors consider refinancing or moving for the following reasons:

You’re planning on needing a safer or more accessible home soon.

Your family home feels too large now that your children have moved out.

You don’t want to take care of upkeep or cleaning anymore.

You need to access the equity in your home.

Your current state or city is too expensive.

Your mortgage payments could be lower.

A new mortgage would lower your interest rate.

You want to change your loan term.

You want to be closer to your

Regardless of your motivation for refinancing or buying, you’ll want to make sure your choice makes sense for your financial situation.

Your Assets, Income, and Retirement Accounts

Most lenders like to see evidence of steady, reliable income from borrowers – and if you’re no longer working, it might be difficult for you to show regular cash flow when you apply for a mortgage loan or refinance. Luckily, many mortgage lenders now allow retirees to use income from their retirement assets to qualify for home loans. This includes:

401(k)s

IRAs

Social Security

Pensions

Investment accounts

The type of investments you have may impact how mortgage lenders view your total income as a borrower. If you have accounts made up of bonds, stocks or mutual funds, lenders can only consider 70% of the value of those assets due to their volatility, so you may not qualify for as large of a mortgage as you initially thought. For your retirement accounts to help your application, you’ll need to demonstrate that you can draw on these accounts without penalties for the next 3 years to support both normal living expenses and loan payments. You’ll also need to provide extra documentation on top of the standard mortgage paperwork to show you have access to these accounts.

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Not retired yet, but planning on it soon? Since lenders want to see evidence that senior citizens have finances to cover at least the next 3 years (either from your job or retirement accounts) you might be denied if you inform lenders you plan to retire sooner. Where possible, it might be best to wait and apply once you’re fully retired and can access your retirement accounts. With that said, you aren’t required to report your planned retirement date. If you do plan on retiring soon, just make sure your finances can cover your mortgage payments once your regular income stops.

Your Thoughts About The Loan Term

Can a 70-year-old choose between a 15- and a 30-year mortgage? Absolutely. The Equal Credit Opportunity Act's protections extend to your mortgage term. Mortgage lenders can’t deny you a specific loan term on the basis of age. The loan term you're comfortable with has much more to do with your finances than your age. Many seniors use a 30-year mortgage because of its relatively low monthly payments, but you might decide to use a 15-year or shorter term depending on your intentions for the house. In most cases, you don’t need to worry about what will happen to your mortgage if you pass before it’s paid off. Your loved ones can usually sell the house to repay the remainder of your loan, but if you want your family to keep the home, you may want to set up a life estate and set money aside or plan on using insurance to cover the mortgage.

rocketmortgage.com - Senior Mortgages: Home Loans And Refinancing After Retirement

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