As long as you are 18 or older, your age won't lower your chances of qualifying for a mortgage loan. Mortgage lenders are not allowed to use age as a reason to deny your request for a mortgage loan, whether you are 60, 70, 80 or 90. This doesn't mean, though, that lenders have to provide mortgage financing to you. You'll still have to prove, despite your age, that you can afford your monthly mortgage payments and that you're not a high risk to fall into foreclosure.
Equal Credit Opportunity Act
The federal Equal Credit Opportunity Act makes it illegal for lenders, including mortgage lenders, to refuse to loan borrowers money based on several factors, including race, color, religion or national origin. The act also forbids lenders from refusing to loan money to applicants because of their age, as long as they are 18 or older.
Debt and Income Requirements
You have to show lenders that you can afford your monthly mortgage payments, whether you're 20 or 80. In general, mortgage lenders want your total monthly debts -- including your new estimated mortgage payments -- to equal no more than 36 percent of your gross monthly income. They also want your total monthly housing payment, including taxes, insurance and interest, to consume no more than 28 percent of your gross monthly income. You'll have a higher chance of getting approved for a mortgage loan, no matter your age, if you can prove to lenders that you fall under these debt-to-income ratios.
Lenders will want to see proof of your gross monthly income when determining your debt-to-income ratios. For many borrowers, a monthly salary makes up the biggest portion of their gross monthly income. That's usually not the case for borrowers who are in their 70s or 80s. But even if you no longer collect a monthly salary, you can still use any other form of monthly income as proof of your financial health. You can use Social Security payments, income from retirement savings accounts, investment income, pension income, regular payments from legal settlements or royalties.
Lenders will also look at your three-digit credit score when determining whether you are a high risk. If your credit score is high -- which it should be if you have a history of paying your bills on time and you're not burdened with mounds of credit-card debt -- your lender will be more willing to give you mortgage money, no matter how old you are. In general, lenders in 2013 consider a credit score that is 740 or higher on the FICO scale to be a strong one. FICO stands for Fair Isaac Corporation, which created the score.
Don Rafner has been writing professionally since 1992, with work published in "The Washington Post," "Chicago Tribune," "Phoenix Magazine" and several trade magazines. He is also the managing editor of "Midwest Real Estate News." He specializes in writing about mortgage lending, personal finance, business and real-estate topics. He holds a Bachelor of Arts in journalism from the University of Illinois.