I am (65+ years old) and am looking to buy a retirement home (for $230,000 with a 20% deposit) but do not have sufficient income to support both mortgages – I was told by a banker. However, the home I currently own is a co-op that is valued at $400K plus. The balance on my loan is $77K – which proves that I have a lot of equity in property. I also own a rental property – which is fully paid off and have two 401(k) and a pension that I have not accessed as yet, in addition to IRA’s, CDs and money market accounts. With the scenario mentioned above, is it possible to receive a mortgage, outside of selling my current residence or getting a co-signer to purchase the second property.
To me, the simple answer might be to tap the equity in the $400k home you owe $77k on and use the proceeds to purchase the new retirement home. Even if you were to do that, you'd still have almost $100k in untapped equity in the existing home, no mortgage on the retirement home, nothing out of pocket (other than refi fees), and probably no more of a mortgage payment than you already have on the house with equity. I don't see any reason why the bank wouldn't go for that, especially if you've got a good payment history on your existing mortgage.
I hope this helps.