Loan Qualifications for Retirees
Retirees trying to obtain a mortgage may find that a pristine credit history and healthy retirement accounts are not enough. Lenders are also looking for a consistent monthly income in line with their usual debt-to-income standards.
Sanford Evans, 75, ran up against this requirement recently when he applied for a $174,000 loan to finance the purchase of an apartment in the Riverdale section of the Bronx. With brokerage accounts exceeding $1 million, a TransUnion credit score of 822, and the ability to make a 40 percent down payment, Mr. Evans didn’t anticipate any problem with qualifying. “I would have paid cash,” he said, “but the interest rates are so low it didn’t make financial sense to do it. I figured this was going to be as easy as it’s been in the past.”
But despite the loan officer’s initial assurances that the loan would close quickly, Mr. Evans, who was moving from a condo in Boston, endured delays that dragged on for months. The problem, he was told, was his income. He received Social Security and monthly dividend distributions, and supplemented these earnings with part-time medical writing for a Boston hospital. Yet he still came up short. The lender wouldn’t count the writing income because he was moving away from Boston.Comment: We've heard this same story from 2 retirees we know.