Sometimes retired home-buyers struggle to obtain a home mortgage loan.
For example, some clients we worked with recently received social security and pension income as they just retired from their jobs a month earlier. Unfortunately, with that income they were only able to get pre approved for $80,000… They had a substantial nest egg and could pay cash, but didn’t want to spend their retirement savings buying a home. The clients were shaken up and didn’t understand why they couldn’t qualify. They hadn’t had issues qualifying for a mortgage when they were employed. This is a scenario that I see too often. Unfortunately, retired clients struggle to fit inside the mortgage lending box due to their income being reduced.
However, there is a program that is catered directly for this scenario. It is called the “Family Opportunity loan.” According to Fannie Mae, a child may provide housing for an elderly parent or a disabled adult child. If the parent is unable to work or does not have sufficient income to qualify for a mortgage on his or her own. This means that as a child of aging parents, you can supply housing for them and obtain the same rates, fees, and lending flexibility as if you were buying your own home to live in. Again, you don’t have to live in the home you buy with your parents to get these special accommodations. Your parent or parents can live there and you can remain in your current living situation. If not for this allowance by Fannie Mae, children buying a home for elderly parents would need to buy the property as a second home or investment property requiring 20-25% down. With this option you can put as little as 3% Down.
This works for homes in all locations, including Brookhaven, Buckhead, Sandy Springs, Dunwoody, Chamblee, North Druid Hills, Peachtree Corners and Virginia Highlands.
Written by Andrew Snyder, Mortgage Loan Originator (NFM Lending)
