Asked anonymously

I want to put half down on a $140,000 mortgage. I have a credit score of 847, but I only make $668 per month in Social Security. Will I be able to qualify?

I have $130,000 in savings and no debt. I am 65 years old.

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  Answers  |  6

March 17, 2016

Rates will vary. Using a 30-year fixed rate of 4.5% on a primary residence with $70,000 down payment, the monthly payments will be around $355 per month. That is for the principal and interest only. Keep in mind that closing costs are extra and the rates will vary.
As a financial advisor not a mortgage broker, my main concerns are affordability.
Some questions for you:
1) How old will you be in 30 years and can you afford to pay for 30 years?
2) Where are you financially?
3) Where do you need to be financially?

Send me a message and together we can find you number. Your number can help you determine how long your income will exceed your expenses. No obligation.

It's not what you make, it's what you keep that determines your lifestyle.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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March 31, 2016

Anonymously, you will be cutting it very tight in qualifying for the home. Since the loan amount is so small I would try the bank you're currently banking with to qualify. If you have other assets it might make it easier for you to qualify.Good luck with your home purchase.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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March 31, 2016

People are talking about affordability based on a mortgage of $335. I am a mortgage banker and we would also look at approximately another $200 a month for taxes and insurance, so it is more like $535, which is 80% of your entire monthly income and that is much too high of a debt ratio for any lender to approve.

Since you are 65 years old you could get a reverse mortgage and then you would have no payment on the home and you would only have to pay the taxes and insurance. Reverse mortgages take no payments and accrue interest and get paid back when you move out of the house permanently, sell or pass away. Your heirs can sell the home and pay off the reverse mortgage and keep the equity. Reverse mortgages are not for everyone and you would need to speak with a good lender and then you would need to get counseling before even applying for the loan. I am licensed to do these loans in CA and would be happy to help you decide if this is right for you. My phone number is on my profile, and I'm happy to help with free advice no matter where you are.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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March 31, 2016

More than likely no. Score is good, savings is good, but your debt-to-income ratio will be too high with a $70,000 loan and $668 monthly income. I would contact the bank you have the $130,000 deposited with and ask them for advice.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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March 31, 2016

You most likely will qualify for a Reverse Mortgage. With an FHA HECM or Reverse Mortgage, you make NO PAYMENT and only have to qualify for tax and insurance payments. This is an option for you because you are over 62 years old. There is more than one way to skin a cat. (Who would do that?!?!) Let's just say that you need to work with Mortgage Lenders who can think outside of the box. There, that's better than the cat.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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March 31, 2016

Ok.
Let's address some of the reverse mortgage answers.
Certainly, a reverse mortgage may help you with no mortgage or low existing mortgage if you qualify.
Keep in mind that if you do not currently own the home, there is very little to ZERO equity to do a reverse mortgage with after taking out taxes, fees, etc.

As Investment Managers, we could use your $130,000 in savings and double it to $260,000 in about 5 years.
Now, you have $130,000 for the house and $130,000 for you. Are you able to wait 5 years without touching the $130,000 in savings? If not, we may be able to customize something else for you.

Before doing anything, discuss you situation in depth with someone who understands both sides of the equation; i.e your income needs and the liabilities. Do you need equity financing or debt financing? Every situation is different. The bottom line is to always do what is in your best interest. Your hard earned $$ need to work as hard for you as you have for those $$ because you deserve nothing less.

We invite you to contact us directly to discuss your situation in greater detail. No obligation.

It's not what you make, it's what you keep that determines your lifestyle.

$commenter.renderDisplayableName() | 01.24.17 @ 01:26

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