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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.
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.
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.
You’ll need to be able to prove your ability to repay the loan. Your lender will check for:
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:
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.
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.
While the best mortgage will depend on your needs and financial situation, look for:
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.
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.
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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