Are You Too Old To Get A Mortgage Loan?

A home mortgage is the biggest debt that most people incur in a lifetime. Therefore, the repayment term is usually 10, 15, 20, or even 30 years. When you are young and buying a house for the first time, a 30-year mortgage makes sense, because it has the lowest monthly payment; it is usually the only kind of mortgage you can afford. When you are 31 years old and you close on the purchase of a house with a 30-year mortgage, you have never thought seriously about how long 30 years is. When you do the math and figure out that you will be 61 years old when the loan matures, it does not seem that bad; you are not old enough to understand how old you will be when you are 61. Now imagine closing on the same house with the same 30-year mortgage, except this time, you are 60. Don’t even finish the math problem; it is too depressing to think about.  The idea that there is such a thing as being too old to borrow a new mortgage loan makes sense, but retirees can and do buy real estate, and sometimes they even finance it with mortgages. To find out more about whether taking out a mortgage loan to buy a house after retirement makes sense for you, contact a Tampa estate planning lawyer.

A Retirement Budget That Includes Mortgage Payments

The old retirement dream was to own your house outright after paying off your mortgage throughout your working years and to use your cash savings to buy a winter home or condo in Florida. If you couldn’t do that, you could do one or the other, age in place in your paid off house up north, or else sell it and buy a place in Florida outright. In the old days, you could sell your house, have enough money to buy a modest place in suburban or exurban Florida, and still have cash left to save.

Today, young people cannot afford to buy real estate at all, and old folks can only afford it if they take out a mortgage. What do your retirement expenses look like if you have a mortgage payment? As everyone who aspires to homeownership can tell you, a mortgage payment is not more expensive than a rent payment, and it is more financially beneficial in the long term.

It makes more sense for seniors to get a 15-year mortgage than a 30-year mortgage, but even that can be affordable if you make a big enough down payment, which seniors are better able to do than young folks. You should only take this step if you want members of your family to still be living in the house 15 years from now.

Contact David Toback About Your Retirement as a Mortgage Borrower

A Central Florida estate planning lawyer can help you plan for your retirement finances when you intend to buy a house and finance it with a mortgage.  Contact David Toback in Tampa, Florida to set up a consultation.

Source:

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