Retirement Planning, Refinancing, and Loan Approval--What If You Never Retire?

A recent CNN Money article paints a bit of a gloomy picture for some. “One In Eight Never Retire” seems intended to be a bit of a warning call about the state of personal finances and other factors, but there’s definitely a silver lining for those who choose to buy or refinance home after retirement age.

According to the article published by CNN, “High levels of unemployment, low wage growth and depressed savings rates have pushed retirement out of reach for many in the global workforce. (Aging) populations have compounded the problem as retirement funds have to cover a longer period.”

Furthermore, the article warns, “Workers in the U.K. and the U.S. face the bleakest future. In both countries about one in five say they will never be able to give up work completely. The prospects are brighter in Asia, with less than half that number in China indicating they're likely to work forever.”

For Americans contemplating this, there’s one thing to keep in mind with regard to owning property and refinancing---it’s sometimes easier to get a new purchase home loan or cash-out refinancing loan at or near retirement age when your employment income is likely to continue. Rather than shifting into a fixed income, the refinance loan applicant with employment income may find it easier to get loan approval--especially when your debt to income ratio is lower.

The CNN article may be full of gloomy prospects for some, but the advantage of having earned income into your retirement years is one you can use on a loan application. Compare your prospects in such a scenario to those you’ve have on a more fixed income. There does seem to be an advantage in some ways to delaying retirement if you want or need to buy or refinance close to that traditional retirement age.

Speak to a loan officer about your options--especially if you’ve already committed to working past your retirement milestone year. And don’t forget that income as a consultant or advisor counts, too--just because you shift roles at a company doesn’t negate the income you bring to the table at application time.

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