Asked anonymously

Does it make sense to take on a new mortgage at 55 years old?

My current mortgage is paid off and the house is valued at $149,000. The new house is listed for $289,000 and my income is $150,000. I have very little other debt.

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  Answers  |  1

March 06, 2017

There is no simple answer to your question as there are many factors that come into play. It will come down to your own personal needs and goals. A few things to think about are as follows.

Are you currently on a fixed-rate program? If so, is the rate market competitive? If monthly cash flow savings is a goal then it is easy to compare today's refinance options and the impact on your payments. However, you will also want to look at the current amortization schedule with the current loan. If you have been in it for a period of time, a higher percentage of your monthly payment is being applied to the principal.

Are you looking fro cash out? That in itself may be a reason to refinance particularly if that cash is being used to pay off debt.

If you are in an ARM that has an adjustment period coming up it may make sense to get into a longer term fixed-rate loan, even if it is another ARM product. Part of that decision may be how long you plan on staying in the home.

In the end, age is not really a driver, it is more about your financial goals and your short and long term plans.

Good luck!

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