How to qualify for a mortgage after retirement

As of November 16, 2025, both Fannie Mae and Freddie Mac no longer have a minimum credit score threshold in their conventional loan eligibility guidelines. Loan approval will instead be based on an evaluation of overall credit risk factors.

 

Before a lender will approve you for a mortgage, they typically need to verify your employment to confirm you can afford to repay the loan. But what happens when you’re retired and don’t have the traditional income you’d have from working full-time? Can you still get a mortgage when you’re retired?

Fear not. It’s still possible to buy a home without a job as a retiree, as long as you meet the requirements of your lender and the loan program, and so long as age isn’t a limitation. Here, we’ll go over how lenders consider retirement income and assets - as well as other factors like credit worthiness and debt-to-income ratio - in the mortgage approval process.

What is a retirement mortgage?

A retirement mortgage is a home loan that enables you to buy a home without traditional income. When you take out a traditional mortgage, lenders require you to submit verification of your income with pay stubs and W-2. forms.

If you no longer earn a regular salary but can show adequate income and asset sources like retirement savings, Social Security, or pensions, then you can apply for a retirement mortgage.

Some lenders advertise specific retirement mortgage programs. Other lenders don’t always explicitly use term “retirement mortgage,” but still may have loan options that you can qualify for based on other income and assets. However, keep in mind you may be charged a higher interest rate.

Note that lenders must still follow Fannie Mae, Freddie Mac, and government-backed loan guidelines, which include specific criteria for retirement income.

How lenders view retirement income

Lenders are more concerned with your ability to keep up with your mortgage payments than they are with how much you earn. Fannie Mae and Freddie Mac instruct lenders to consider borrowers with dependable and predictable income, but there can be many potential sources that can qualify.

However, some loan guidelines allow underwriters to include nontaxable income like federal pensions, state retirement income, child support, or disability.

An asset-depletion mortgage counts a portion of your assets – typically 70% - 80% of your retirement account balances - as income, depending on the lender. The lender will take the total balance and divide it by the number of months in your loan term and count that as income.

Common retirement income sources

Let’s take a look at some of the different income sources you may receive as a retiree that can help you qualify for a mortgage.

How assets can help make up for income

If you’ve been able to retire, then you may have substantial money held up in assets, like physical property or stocks. One option is to sell assets to make a larger down payment, but you may prefer to hang onto them.

Another option is to get a securities-backed loan. With this option, your assets - like stocks, bonds, and property - act as collateral for a loan to help you buy a home. This gives your lender the rights to them if you can’t repay your loan. However, it also means the lender is taking on less risk lending you money, which makes it easy for you to qualify for the loan. Like retirement accounts, lenders consider up to 70% of the value of assets that quickly fluctuate in value.

If you are looking for a good place to start for determining how much home you can afford, check out the mortgage calculator from Rocket Mortgage^®. This tool will show you a rough estimate of your monthly payment based on the amount of money you decide to borrow. Consider playing around with the calculator to get an idea of how much you can comfortably afford to borrow with your income.

How your debt-to-income ratio affects approval

Your debt-to-income ratio (DTI) is a figure that reflects what percentage of your monthly income goes toward paying debts. Lenders use your DTI to determine how much risk you pose as a borrower.

If your DTI is too high, it means a substantial amount of your income has to go toward paying other debts. This increases your risk of defaulting and can jeopardize your ability to get approved for a mortgage. Having a low DTI can help you get a better interest rate and better manage your monthly payments.

When you’re retired and applying for a mortgage, your DTI becomes even more important because you no longer have access to the full income you earned while you were still working.

You can calculate your DTI by adding up all your monthly minimum debt payments and dividing that sum by your gross monthly income. For example, if your qualifying retirement income is $4,000 per month and you have $1,000 in other monthly debt payments:

$1,000 / $4,000 = 0.25

DTI = 25%

To learn earn more about how to make this calculation, check out our guide on calculating your DTI ratio.  

The maximum DTI you can have to get a mortgage can vary depending on your lender, loan program, and credit score. Typically, you’ll need a DTI that does not exceed 50% to get approved.

Since you might have a difficult time finding a loan with a DTI ratio higher than 50%, it is important for you to be proactive and take time to reduce your DTI ratio.

Tips for lowering your DTI

If your DTI is on the higher end, here are some steps you can take to reduce it:

• Pay down credit card debt.
• Get a part-time job, side hustle, or seasonal work to boost your income.
• Add a partner to the loan.
• Don’t apply for new lines of credit.
• Don’t slow down debt payment to make a down payment.

Why your credit score is important

Your credit score will impact your ability to get approved and the interest rate you’re offered. Increasing your credit score can increase your chances for a retirement mortgage, especially if you have a lower income or more debt. Having a high credit score shows lenders that you’re more likely to pay your bills on time and avoid borrowing too much money, in turn giving you access to more lenders, more loan types, and lower interest rates.

Tips for boosting your credit score

Here are some ways to increase your credit score before you apply for loan:

• Pay your bills on time.
• Pay down existing debt.
• Keep your credit card balances low.
• Keep unused credit lines open.
• Avoid opening new lines of credit.
• Request an increase to your credit limit.
• Dispute any inaccurate information on your credit report.

The credit requirement you must meet to get a mortgage will vary depending on your loan type and lender. To get a conventional loan, you’ll typically need a credit score of at least 620. For an FHA loan, you’ll need a credit score of at least 580.

Is getting a mortgage in retirement right for you?

Getting a mortgage in retirement is doable if you have the money to keep up with your monthly payments. It can make sense if you want to downsize or relocate to be closer to family. However, be prepared to prove you have the income and assets to repay the loan. Also, know that you may be charged a higher interest rate. If your budget is already fixed or tight, it may not be a good idea to take on additional debt in retirement. You can use the home affordability calculator from Rocket Mortgage to see what kind of mortgage you can comfortably afford.

FAQ

If you still have questions about getting a mortgage in retirement, we’ve got answers.

Does property type impact retirement mortgage eligibility?

The type of property you buy will influence how easy it is to qualify for a retirement mortgage. If you want to buy a primary residence, you’ll have an easier time qualifying. If you’re buying a second home, you may need to meet higher income, credit, and down payment requirements because you’re more likely to miss payments on your second loan if you run into a financial emergency. When ready, you should consult with your lender to learn more about what you need to qualify for a retirement mortgage.

What’s the minimum retirement income to get a mortgage?

There is no specific minimum income you’ll need to get a mortgage during retirement since approval will depend on your lender, ability to pay, DTI, credit score, loan amount, stability of income, and other factors.

Is it better to rent or buy a home in retirement?

The answer will depend on your financial situation and your priorities. Buying and owning a home gives you the ability to build equity and wealth to one day leave behind to your heirs. You’ll have full autonomy over what you do with the home, but it’s also a major financial commitment. If you’re thinking of buying a home while retired, be sure you have the money to keep up with the monthly payments. In some markets, it’s less expensive to rent than it is to buy. You can use our rent vs. buy calculator to compare the costs of each option.

Can a retired person get a mortgage with no down payment?

Certain government-backed loans - like VA and USDA loans - don’t require a down payment. However, VA loans are only offered to military servicemembers, veterans, and their qualifying existing spouses. USDA loans are only for low- and moderate-income borrowers in certain rural areas. Conventional loans require you to make at least a 3% down payment. Down payment assistance programs are offered by state and local governments and certain nonprofits to help you cover the up-front costs of buying a home. Also, the One+ by Rocket Mortgage loan program allows you to get a mortgage with a 1% down payment.

The bottom line: You can qualify for a mortgage after retirement

It’s still possible to get a mortgage even if you’re retired. Lenders will consider pension, Social Security, and investment income as your regular income. They will consider your annuity, survivor, or spousal benefits and retirement account income as long as you can prove it will continue for at least 3 years. Even your assets can contribute to your ability to get a loan.

Improving your DTI ratio and credit score can increase your chances for a retirement mortgage. If you’re seeking a mortgage loan for a primary residence rather than a second home, you may have an easier time getting approved.

Start the mortgage approval process online with the Home Loan Experts at Rocket Mortgage.