Retiree Loans: What Are They and How Can You Get One?
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What Are Retiree Loans?
Why Might You Take Out a Loan in Retirement
Home renovations. Once officially retired, many people choose to tackle home projects they had once put off. Whether it’s a simple home renovation, an addition, or finally taking care of deferred maintenance, a personal loan for home improvement can help make big projects possible. Debt Consolidation. It may be a smart move to consolidate your debts with a personal loan. If the interest rate is lower, you may be able to afford a more aggressive payoff strategy so your debts don’t affect any inheritance you leave your beneficiaries. Travel. Retirement can be the perfect time to travel the world because you no longer have the same time restrictions. You can likely choose when to leave and when to come back. You might consider using a personal loan to fund a trip rather than dipping into your nest egg. Gifts. Oftentimes retirees choose to take out loans as a gift for a family member. You might take out a loan, for example, to help an adult child purchase their first home or help pay for a family member’s wedding.
Can Someone Who is Retired Cosign a Loan?
Common Loans for Retired Individuals
Home Equity Loan
Reverse Mortgage Loan
Debt Consolidation Loan
Personal Loan for Senior Citizens Requirements
Your age (some lenders have a cut-off point of 75) Strong credit score (ideally in the 670-739 range) Low debt-to-income ratio (more on that below) Steady source of income (from part-time work, rental income, Social Security, pension, and/or investments) Sufficient collateral, or assets (needed for a secured loan)
How Lenders View Retirement Income
Annuity Income Income from investments Pension Social Security benefits Spousal or survivor's benefits Monthly retirement withdrawals Regular payments form investment accounts
Credit card bills Mortgage Student loans Personal loans Auto loans
Frequently Asked Questions
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