Buying a Home in Retirement

Retirement Can Expand Your Ability to Buy

It is a misconception that it is harder to buy a home once you are retired. In fact you may have more options. If you are 59 ½ you are officially of retirement age. This allows you to withdraw from retirement plans like 401(k)s and IRAs penalty free. That doesn’t mean you have to liquidate your nest egg to buy, but it does allow you to use your retirement accounts to qualify for a mortgage.

Structured Distributions

Lenders look at monthly income to see what loan amount you can qualify for. Setting up a structured distribution from your retirement accounts can increase the amount of financing you can receive. Conventional mortgages allow you to qualify off of 1/36 of your total retirement account monthly. This can be in addition to other income sources. Work with a lender to see how much you need in a monthly distribution to qualify for your home purchase.