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Older buyer with low income, but high assets….No Problem….and some other news from the mortgage world

Over the past decade, many older buyer clients have been challenged when trying to qualify for a mortgage as they are living on fixed income, but often have significant assets. Often, these buyers could pay cash out right for a property, but do not want to liquidate a substantial amount of assets in order to buy their new home. Freddie Mac has recently updated their guidelines now allowing for “asset-based income” to be used. The requirements and calculations are quite easy. The buyer must be age 62 or older, all assets (less funds needed to close) are added and the sum divided by 360. That figure is then used as additional qualifying income. This can help more older buyers get qualified!

Additionally, both Fannie Mae and Freddie Mac have increased their debt ratio thresholds to 50% (old guideline was 45%) without necessarily requiring compensating reserve funds. This change can help a lot more buyers of all ages qualify for a Conventional mortgage. This guideline carries over to the HomeReady program as well!

Please contact me if I can be of service to you or your buyer clients.

   

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We were very impressed with Jeremy McMichael’s thorough and punctual assistance throughout the process of our new home purchase. His knowledge was very evident in how he was able to answer our questions and guide us to next steps. He made the process very easy!


5 stars on 5/18/2018

Jeremy was so helpful during our home search and buying process. He was always available for questions (I had a lot!) and was very quick at turning around information. Jeremy made purchasing our new home a seamless process. I would highly recommend him to anyone who is in the process of looking to finance a home.


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Jeremy had great communication and accomplished everything I would have expected a good mortage lender to accomplish. There were no surprises or issues. Highly recommended!


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