Becoming a real estate investor is often seen as one of the universal signs of personal financial achievement, no matter what your age. While, technically, in the U.S., there is no age limit for getting a mortgage, there are some age-related home buying guidelines you should keep in mind.
Can You Be Denied a Mortgage Because of Age?
Getting a mortgage can be tricky for borrowers of any age, but older adults may face additional hurdles. Age discrimination is illegal, but lenders are allowed to consider age-related factors when assessing creditworthiness. Understanding the nuances in the law can help older borrowers navigate the mortgage process.
The Law on Age Discrimination
The Equal Credit Opportunity Act (ECOA) prohibits lenders from discriminating against borrowers based on age. However, lenders can legally consider age in limited circumstances when evaluating creditworthiness.
For example a lender may look at your income employment status, and retirement plans to determine if you have stable income to repay the loan. They can also consider your life expectancy relative to the loan term, especially if the property is the only collateral.
While age alone cannot be used to deny a mortgage, it can be one factor in assessing creditworthiness. Discrimination typically occurs when age is the sole or primary reason for denial.
Research on Mortgage Outcomes and Age
Despite legal protections, research shows higher mortgage denial rates for older borrowers:
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A Federal Reserve study found the probability of mortgage denial rises consistently with age, accelerating around 70. The rejection rate for the oldest applicants was 1-3 percentage points higher than younger applicants.
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Another study found over-50 borrowers face a 17.5% average denial rate, versus 12.4% for Federal Housing Administration loans. Rejection rates increase more rapidly after age 70.
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Older approved borrowers also pay higher interest rates, around 0.08 percentage points more than borrowers in their 30s.
While the reasons are unclear, factors like insufficient home equity, credit scores, and lender concerns over mortality risk likely contribute.
Tips for Older Borrowers
If you’re worried about age discrimination when applying for a mortgage, here are some tips:
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Shop around with multiple lenders to compare offers and eligibility requirements. Find a lender who evaluates your entire financial profile.
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Optimize your credit score and debt-to-income ratio ahead of time. This puts you in the best position for approval.
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Provide all sources of retirement income to give a complete picture of repayment ability.
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Consider a shorter-term loan that aligns with your estimated life expectancy.
With proper preparation and a prudent lender, your age should not be a barrier to mortgage approval. Understanding the law and your rights is key to overcoming any potential discrimination.
HOW OLD IS TOO OLD TO GET A MORTGAGE?
Because a mortgage is a legally binding contract that allows you to finance the cost of a home over a long time, some people might wonder if there are age limits involved. For example, if you’re 75, could a lender refuse to let you take out a 30-year mortgage? After all, the average life expectancy in the United States is 78.6, according to the Centers for Disease Control and Prevention.
The good news for seniors looking to buy a house is that it is against the law for a mortgage lender to discriminate against you based on age. The Equal Credit Opportunity Act (ECOA), which came out of the Civil Rights Act of 1964, says lenders cannot deny you credit based on age, as well as other criteria like race, color, religion, national origin, sex, or marital status. The Fair Housing Act of 1968 adds even further protections, specifically stating that it’s against the law to discriminate in any residential real estate transaction.
However, there are some instances in which a lender could consider a lendee’s age indirectly. According to the Consumer Financial Protection Bureau, a lender may look at whether you are close to retirement age and make a decision based on your having enough income to handle the loan. But again, in this instance, the disqualifying factor is not your age but rather your ability to manage loan payments.
HOW YOUNG IS TOO YOUNG TO GET A MORTGAGE?
Can age be a discouraging factor when it comes to getting a mortgage if you’re closer to high school graduation age than retirement? Lenders can’t deny a mortgage application solely because of age, but states have laws that determine the age at which a contract can be negotiated. For example, in Virginia, you must be 18 to enter into a legally binding contract, including a mortgage.
Your age may also affect your ability to meet other requirements for being approved for a mortgage loan.
Lenders evaluate your income to see that you have enough to make the mortgage payments. If you’re under 18 or even in your early 20s, it’s unlikely that you’ll have a job in which you make enough to take on a mortgage. Lenders also typically require you to have a specific credit history, meaning they may not have enough credit history to meet the lender’s requirements. Young people who haven’t had time to build a credit history by using credit cards or taking out loans are likely to fall in this category.
Finally, homebuyers typically need to make a down payment. For example, the minimum down payment for a non-citizen is 30%. U.S. citizens living abroad and purchasing a second home or investment property may be able to put down as little as 10% if they still maintain a U.S. credit score.
What to do if you are denied a mortgage
FAQ
Can you be denied a mortgage due to age?
Under the Equal Credit Opportunity Act, lenders can’t discriminate against applicants because of their age. As a result, older people — like those in other age groups — can get mortgages and other home loans if they meet a lender’s approval criteria.
At what age is it harder to get a mortgage?
Age is a factor
The overall average rejection rate is 17.5 percent. Rejection increases with age across the board with lenders. Around the age of 70, rejection rates accelerate. Relative to race and ethnicity, applicant age plays an equal role in mortgage approval.
Can a 70 year old man get a 30 year mortgage?
The short answer: absolutely! Luckily, whether you’re 25 or 70, lenders look only at certain numbers when reviewing a mortgage application. Those numbers aren’t age but rather a borrower’s income, credit score, assets, and debts. When you’re retired, though, landing a 30-year mortgage can be more complicated.
Will my age stop me from getting a mortgage?
Many lenders impose an age cap at 65 – 70, but will allow the mortgage to continue into retirement if affordability is sufficient.Mar 19, 2025