Based solely on age, lenders should not discriminate against a mortgage applicant. However, age can have an indirect impact on mortgage approval since it can be an indicator of a borrower’s ability to repay the loan. Here are a few ways your age can affect your borrowing eligibility.
If you are very young, you may not think you can qualify for a loan. That is not necessarily true. However, it is likely that you have a more limited credit and employment history than older borrowers, which lenders will almost certainly take into consideration.
In addition, younger borrowers often do not have enough money saved up to put the standard 20 percent down payment on a house. However, all is not lost.
There are loan products specifically designed for people with lower credit scores and lower down payments. For example, it may be possible to get an FHA loan with a low 580 credit score and just a 3.5 percent down payment.
In some cases, borrowers may even be eligible to accept a monetary gift from relatives to help meet those down-payment requirements.
On the other end of the spectrum, older borrowers may also face certain challenges when apply for a loan. While some lenders have no maximum age for borrowers, others will not lend to applicants who have reached retirement age.
If you are still working, but nearing retirement, a lender may want information about how you will pay your loan off when you stop working. This may include using revenue from an investment property, selling some of your financial assets, or using annuity payments to cover the debt.
You can improve your chances of approval by raising your credit score, offering a sizable down payment, paying off your debts, and providing evidence of a strong retirement nest egg.
No matter what age you are, it is important to work with a mortgage lender Johnson City to better understand the options available to you. Contact us today for more information. We look forward to serving you soon.
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