Posted in home

Considering a home purchase in retirement? Here’s how to get a mortgage

  • While home prices continue to climb upward, the average interest rate on a 30-year mortgage is low by historical standards: just below 3%.
  • If your tax returns don’t show enough income to qualify for a mortgage, you might be able to temporarily tap your retirement account to prove you can afford the loan.
  • Another option may be to qualify based on assets in that account, or explore “pledging assets” to make the purchase.



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If you’re retired and are thinking about downsizing or relocating, and it involves buying a home, you might want to look into how you would finance it.

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You may discover that qualifying for a mortgage is different from the last time you bought a house. Not only have lenders tightened credit during the coronavirus pandemic, retirees generally have left a steady paycheck behind.

It can be tricky for retirees to get

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Posted in home

How to get a mortgage when considering downsizing in retirement

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If you’re retired and are thinking about downsizing or relocating, and it involves buying a home, you might want to look into how you would finance it.

You may discover that qualifying for a mortgage is different from the last time you bought a house. Not only have lenders tightened credit during the coronavirus pandemic, retirees generally have left a steady paycheck behind.

It can be tricky for retirees to get a mortgage, said Al Bingham, a mortgage loan officer with Momentum Loans in Sandy, Utah.

“You can have a lot of money but show very little income and have difficulty qualifying for a mortgage,” Bingham said. “It frustrates a lot of them.”

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4 Things That May Cost More In Retirement And Why

People often underestimate how much they will need to maintain their desired lifestyle in retirement. Most assume their expenses will go down when they’re no longer working, and the kids are out of college. While certain work-related costs, such as commuting, parking, clothing or uniforms, and even that daily latte may cease, other costs for travel, entertainment and healthcare can quickly replace, or outpace, expenses incurred during your working years. That’s why it’s so important to estimate your retirement expenses well before you pull the plug on work.

Determining how much you may need in retirement takes a little work, but it’s much easier if you have a good handle on your current expenses. If you’re not sure what you’re spending now, create a budget. Expenses generally fall into three broad categories:

  1. Essential expenses
  2. Discretionary expenses
  3. One-time expenses

Begin by determining what your necessities are. Ask yourself: “If I

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Posted in home

Reverse mortgages may be helpful in retirement but mind the pitfalls

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If you’re thinking about a reverse mortgage, be prepared to learn a lot about a complicated financial commitment. 

With a reverse mortgage, you can convert part of the equity in your home into cash instead of selling, provided you’re at least 62 years old. As long as you continue paying taxes and maintaining the home, you cannot be evicted.

It may sound like the answer to your retirement cash prayers, but complexity and costs are among the factors to consider.

Here’s how it works. Instead of a debt that gets lower as you make payments to the bank for a regular mortgage, a reverse mortgage is the exact opposite.

You draw out funds and interest builds up, while the balance grows larger and you hold less equity in your home. 

Keep in mind, you must use the funds to first pay off any existing

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Jane Young: Should you strive to be mortgage free in retirement? | Business

Transitioning into retirement without a mortgage can reduce stress, improve cash flow and increase your sense of financial security.

But while everyone would love to be debt-free, there are many factors to be considered before making extra payments or pulling from your savings to pay off your mortgage.

You need to maintain adequate liquidity to cover living expenses, an emergency fund of at least four months of expenses and major planned expenditures such as new vehicles, home improvements and tuition for your children. Once you make the extra mortgage payments, you will lose access to those funds without refinancing or taking out a home equity loan.

If you have other high interest debts on credit cards, vehicle loans or student loans, you should pay those before making extra payments on your mortgage.

If you have the funds to make extra payments, how would you spend the money otherwise? Would you

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Continue Reading Jane Young: Should you strive to be mortgage free in retirement? | Business