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Getting a mortgage over 60

Federal law prevents lenders from discriminating based on age.

If you’re 60 years or older and looking to buy a new home, your age alone isn’t enough to prevent you from getting a mortgage — but if you’re retired, you’ll need to show you can still meet the repayments through your retirement income.

Is there a maximum mortgage age limit?

No. It’s illegal for a mortgage lender to decline you based on your age. As long as you’re able to meet the financial requirements, you can qualify for a loan at any age.

Can a retired person get a mortgage in Canada?

One of the requirements for most mortgages is proof of a steady income, which can be trickier if you’re retired or if you’re about to retire. You’ll need to show the lender that your retirement status won’t affect your ability to repay the loan.

What do I need to do to take out a mortgage if I’m over 60?

You’ll need to be able to prove your ability to repay the loan. Your lender will check for:

  • Proof of income. If you’re retired, you’ll still need to prove that you’re receiving a steady income and will be able to make consistent loan payments. This can include a combination of pension and retirement plan payments.
  • Debts. This includes any outstanding debts, such as credit cards, loans and current mortgages.
  • Debt to income ratio. Mortgage providers will look at your income in comparison to all your debts to determine if you are qualified to take on a mortgage.
  • Credit score. A good credit score will make a big difference when it comes to lenders. If your score is less than ideal, consider using a credit repair service before applying for a mortgage.

How to get your mortgage application approved

While it can be more difficult to get a mortgage if you’re retired or planning on retiring soon, it’s possible with the right preparation. To increase your chances of being approved:

  • Have a retirement strategy. If you’re still working, have a plan in place for how you’ll continue to pay your mortgage once you retire. This can include your retirement accounts, pension and a plan showing how you will afford your payments each month.
  • Minimize debt. The amount of debt you have is a crucial factor a lender will take into account when assessing your loan application. Pay down existing debt before you apply to increase your chances of approval.
  • Save a bigger down payment. The more money you have saved, the more money the bank will be willing to let you borrow. If you can display proof of savings and regular financial discipline, your borrowing power will increase.
  • Provide extra financial evidence. Bring as much financial information as possible when you apply for a loan. For example, if you’ve successfully repaid a previous mortgage, including this in your application will show that you’re a reliable borrower. If you own an investment property that’s paid off, bring information on the most recent appraisal to prove that you can sell it as a source of income if needed.
  • Ask an expert. If you’re having trouble getting qualified, consider using a mortgage broker. A broker will be able to help you find the lender and loan most suitable for your needs, and can offer advice and assistance on how you can put together the best possible loan application.

Buying a home in a retirement community

If you’re interested in moving into a retirement community, find out if they sell condos or single-family homes before applying for a mortgage. Some retirement communities look like they’re made of traditional houses, but are actually detached condos.

While it is possible to get a mortgage for a detached condominium, you’ll likely need to make a higher down payment — especially if the community’s homeowners association doesn’t meet certain standards.

Canadians buying property in the US

A number of Canadians escape the winters by spending the colder months in a warmer US location before returning to Canada for the summer months. The most common places that these Canadian snowbirds own real estate is in Florida, California and Arizona. Many snowbirds are retired, but it’s not necessary to live the lifestyle.

However, individuals interested in the snowbird lifestyle often avoid buying US property because of common misconceptions. Many Canadians believe that they must go through a US lender, which requires a US credit score. Since most Canadians don’t have a US credit score, they avoid the mortgage process entirely. In reality, Canadians can obtain financing with a local bank in Canada, so long as the lender operates in the US state they are looking to buy in. A number of Canadian banks operate in Florida, California and Arizona to help Canadians fulfill their snowbird dream.

Aspiring snowbirds also worry about the foreign exchange risk and tax implications of buying US property. As many snowbirds aren’t aware that loan products exist with Canadian lenders for a US purchase, they pay in cash. This exposes them to foreign exchange fluctuations. Fortunately, Canadian banks can help you finance your US property purchase. And while the tax implications of owning a property in the US may seem daunting, Canadian banks that specialise in cross-border purchases have tax experts that assist with these types of taxation questions.

If you’re considering the snowbird lifestyle, but are fearful of the process and repercussions, you may want to look in to Canadian banks that offer cross-border mortgages and advice. Many Canadians consider themselves snowbirds, and you can too. Before writing it off as an option, it’s worth looking into.

How do I find the best mortgage?

While the best mortgage will depend on your needs and financial situation, look for:

  • Low interest rate. Even a small difference in the interest rate can have a major impact on the total you’ll pay for the home.
  • Minimal closing costs. Closing costs generally range from 2% to 5% of the home’s value. On a $250,000 home, that’s a $7,500 gap. Securing low closing costs, or negotiating a deal where the seller pays the closing costs, can save you thousands.
  • Additional repayment flexibility. A loan that allows you to make unlimited additional repayments means that you can pay down your debt quicker and minimize the interest you pay, which is especially important if retirement is just around the corner.

For more details on the features you should look for in mortgages for people over 60 years old in Canada, check with a mortgage broker and ask for advice tailored to your needs and situation.

Compare mortgage lenders

Name Product Interest Rate (APR) Loan Term Min. credit score Provincial availability
Tangerine Mortgages
2.14%
5 Year Fixed Rate
620
All of Canada
Get competitive rates and make annual lump sum prepayments up to 25% of your original mortgage amount with a Tangerine mortgage.
Breezeful Mortgages
1.74%
5 Year Fixed Rate
600
All of Canada
Breezeful is a 100% online mortgage broker that connects borrowers to competitive rate offers from over 30+ banks and mortgage lenders.
Homewise Mortgages
Varies
Varies
600
Not available in Quebec
Homewise's personal advisors can get you mortgage rates from over 30 banks and lenders.
intelliMortgage Mortgages
1.42%
5 Year Fixed Rate
680
AB, BC, NL, ON, PE
intelliMortgage is an online mortgage broker that works with over 100+ banks and mortgage lenders across Canada.
Loans Canada Mortgages
1.79%
5 Year Fixed Rate
400
All of Canada
Loans Canada connects borrowers with a mortgage broker in their area. Bad credit, EI and CERB applicants are considered.
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Compare up to 4 providers

What are the risks of mortgages for seniors?

If you’re retired or planning to retire soon, taking on new debt can be a risky endeavor. If your expenses are higher than expected, you could end up having to postpone your retirement or go back to work to make ends meet. And if your retirement money is tied up in stocks, you could end up in financial trouble if the economy takes a downturn.

Bottom line

Getting a mortgage when you’re over 60 is almost the same as getting a mortgage when you’re younger — but you will need to prove a source of income if you’re no longer getting pay stubs. To get the best deal, compare mortgage lenders before getting started.

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