Buy in TV now or after I retire?
 

We had been planning to buy our home in TV after retiring. Someone recently told me recently that if I wait until after retirement my credit score and hence interest rate on my mortgage will be affected negatively, Even though I will have a pension coming in and money in the bank. I assume if this is correct some of y’all may have experience or knowledge of this. Thanks
Oh yeah, Merry Christmas to all!!

The person who told you your credit score will decline and interest rate will be higher is wrong. A second home will usually have a higher interest rate. It is a personal decision whether to buy now or after retiring. Many buy and rent out until they are ready to move to lock in price but it can be a hassle to manage from far away. Many things to consider but others on here can provide you their experience. Good luck.

I don't think there is any panic to buy until the Village of Miami is for sale!

I would buy when you need the home.

HOWEVER

My understanding is that it is harder to get a mortgage the day after you retire than the day before. The reason is if you are employed they project that income even if you plan on retiring. After retiring it is much harder to justify the mortgage.

Thus I think they is a reason to get the mortgage lined up before you retire.

I have bought three homes after retiring and gotten mortgages on all three at the best available rates. If you have good credit, ample income and savings you should be just fine after retirement. If you don’t you probably shouldn’t be buying a property.

We bought 5 years before retiring and rented it seasonally until we retired

Prior to retirement and buying here, we were close to having our mortgage paid off on our home. We figured we'd have the house paid off when we retired, sell the house and come here and buy. However, we also figured that would be stressful as we'd either have to buy a house here somehow before we got the money from the sales of our house or we'd have to store everything we owned and live in a hotel in the gap between selling there and buying here. We talked to our bank about it and they brought up the idea of a Home Equity Line Of Credit (HELOC). They loan you a fairly large percentage of the equity in your current home and you can use that money to A) pay off the mortgage on the existing home and B) buy or at least get a large down payment for a new home. The down payment didn't quite cover the cost of the new home we wanted here so we got a small mortgage to cover the balance. So we exchanged a mortgage payment for a HELOC payment and a small mortgage payment (for about the same monthly outgo). We then rented out the house here as a long-term, unfurnished house until we were ready to retire. With tax credits and such, we may even have made a few buck or at least didn't lose much each month and when the time was right for us to retire (and the long-term rental agreement was up), we moved here to the house we had wanted. In that mean time of roughly 18 months, the value of the house (according to Zillow) had gone up by 10% or more. We've been here 3 years and Zillow claims the house is worth about 30% more than what we bought it for. Judging from the sales prices of comparable houses, I think they're pretty accurate on that account. While the values were appreciating where we had lived, they weren't doing so nearly as quickly as they are here in The Villages. So if we'd waited, we'd maybe have gotten a bit more for our house but definitely would have paid more for a comparable house here.

In short, buying before we retired and moved here worked out quite nicely for us. Your mileage may vary.

we Bought 7 years before one retired, and use as a vaca home. It was well worth it for us

No, retirement doesn't impact your credit score. However it will change your income, this in turn impacts your ability to pay a mortgage.

Here is the exact ratio for Fanie Mae mortgages: 36% of pre-tax income on all debt. No more than 33% on mortgage. The percentages used to be 28 and 31 total under pre Clinton underwriting rules.

Most banks use Fannie Mae standards in order to resell the mortgage, while some banks hold the mortgages and don't sell them, typically they use higher underwriting standards. The Developer controlled bank is one of those, they require 25% down not 20 and at higher rates, if yout throughly research rates. This was the case for my recent purchase. Others may have other experiences.

We purchased 7 years before retirement. Rent out seasonally and enjoy the home a few times a year. Everyone has told us we did it the right way. With the houses appreciating, we agree. Some days are harder with 2 mortgages, but when we sell our home up north, the $$ will go to mortgage and we have our retirement home all ready. Worst case scenario, we sell our villages home and have made some $$

When you retire and sell your home pay cash for your village home. You'll be too old for a new mortgage. 50% percent of men die within 3 years of retiring.

We retired, sold our house up north, then bought in TV. Checked 3 banks and Citizens First had best rate, 3 5/8 over 20 years. Our credit rate wasn’t affected at all. At 3 5/8, it makes no sense to me not to have a mortgage when I can make more investing my money. The money is there if I need to pay it off.

Us too.
I'm not buying into the comment "the second home will have a higher interest rate."




I think the key is, buy when you find the house you love, in the area you want.

In the United States of America? In the 21st Century? That's an incredible statement to pass off as fact! Please cite your source for this garbage.

sometimes you just have to let the BS flow off your ToTV back.