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I've just retired and wish to refinance my mortgage. However, when I spoke with my bank, they said that since I no longer have a consistent paycheck I dont qualify under their rules for a refinance. However I will be taking consistent IRA distributions as well as receiving a consistent social security check, which I've read online (when others have faced this issue) should qualify as consistent income for purposes of a mortgage.

Does anyone have any suggestions on other options I can try: e.g. Should I be looking at refinancing through another bank? Would a credit union be more likely to qualify me than a traditional bank, etc?

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Unless you are old enough to that Required Minimum Distributions have to be taken, just the promise that you will take consistent IRA distributions might not be good enough for the bank. You could consider converting some of your IRA money into an annuity which would give you an annuity certificate that you can show the bank as proof of regular income. Set up within the IRA, you would pay tax on the annuity payments are received, that is, don't take a lump sum distribution and pay tax on it and then go buy a single-premium annuity from an insurance company with what is left. –  Dilip Sarwate Sep 10 '12 at 19:08
    
I am old enough where RMD has to be taken. Can you list the annuity idea as an answer so that I can accept it/give credit to it? –  Sawatadee Sep 10 '12 at 19:12
    
Is the social security income plus any defined benefit pension enough to qualify for the loan? –  mhoran_psprep Sep 10 '12 at 20:33
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You should consider converting some or all of your IRA to an individual retirement annuity. This will result in you receiving an annuity certificate that you can show the bank, and the bank may be willing to accept that as proof that you will be receiving consistent payments on a monthly basis. Since you are old enough that RMDs must be taken, you should do this in consultation with a professional (don't rely completely on what the IRA custodian (or its call center employee) tells you), because even IRS Publication 590 throws up its hand in the matter of explaining this to ordinary mortals and simply says

Distributions from individual retirement annuities. If your traditional IRA is an individual retirement annuity, special rules apply to figuring the required minimum distribution. For more information on rules for annuities, see Regulations section 1.401(a)(9)-6. These regulations can be read in many libraries and IRS offices.

Of course, the problem is exacerbated further if some part of your IRA has been converted into an annuity and the rest is still invested with some brokerage/mutual fund company/bank etc and has its own RMD requirements.

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