5 Easy Home Loan Options for Senior Citizens

Many of us spend our life-saving money on our dream home. Some make it to the desired goal faster than others, while some have to resort to home loans. Buying property with every penny from your savings can seem like a risky decision, but it can be a good option of income for senior citizens. Buying a house in your retirement and renting it can supplement your income.

If you don’t have the required capital to invest in a house, you can choose a home loan. If you’re buying a home for the first time, it can be quite confusing for you to choose a proper loan option. Below are five easy home loan options for senior citizens.

Reverse Mortgage

This type of home loan is available for senior citizens above the age of 62. Instead of paying a lump sum amount to the borrower, the lender pays them a monthly amount, and the borrower can use them any way they want. This is counted as a stable, tax-free income, and it turns the house into an asset.

The payment is available for a certain period. After the term ends, the house is retained by the lender or the bank.

If you’ve never applied for this type of loan, research thoroughly how a reverse mortgage works before you choose to go for it. Reverse mortgages have various pros and cons, and you must not blindly choose them without knowing all the possible outcomes.

Asset Depletion Loan

An asset depletion loan is much easier to get than other types of loans as it is issued based on your liquid asset. If you have a cash reserve, you are eligible for applying for this loan. The lender will require a few documents along with proof of the liquid amount in your bank account, and you won’t need a stable income source to be eligible.

The lender will calculate the price of the house and divide it into monthly income against the designated period. Then they will calculate whether you – the borrower – can pay it off in due time.

Not all types of savings or liquid assets are eligible for getting an asset depletion loan. Please check with your local bank to see if your source qualifies. You might need to present important documents such as a bank solvency statement, proof of retirement, and income tax returns.


HECM is also known as Home Equity Conversion Mortgage. It’s a type of government-issued loan for senior citizens. In HECM, citizens above the age of 62 can turn their home equity into cash and pay off any mortgage amount. If they have withstanding cash, they can use it for personal purposes.

Even though the borrower doesn’t have to pay monthly mortgages, they have to pay the insurance and taxes applicable on the asset. If an owner dies before the loan is paid, the heir of the deceased can choose to sell the home to the lender or carry on the loan repayment. If the deceased borrower doesn’t have an heir, authorities sell the house to pay off the loan.

VA Loan

Senior citizens who have served in the military can apply for VA loans. As a veteran, you don’t have to pay the down payment. Even the mortgage rate is usually lower than the regular rate.

Lenders of VA loans usually have well-designed websites and they allow borrowers to apply through their online system. You can easily receive quotations from them from the comfort of your home.

If you haven’t retired from the military after serving all your life and have only served for a short period, you can still apply for this type of loan. Check with local authorities to see if you’re eligible.


HELOC, or Home Equity Line of Credit, is considered a much simpler form of home loan option for senior citizens. In this option, the borrower can take a small amount of loan every month against their home equity. HELOC allows the borrower to turn their home into an asset. It is impossible to encash a house or any asset, but with this loan option, borrowers can turn it into instant cash.

However, not everyone can apply for a HELOC. To be eligible, you must present your proof of income, good credit score, and a low debt-to-income ratio. You must also prove that you can pay off the debt well, and must possess at least 15% of the home equity.

Buying a house after retirement can become a true hassle if one doesn’t have sufficient knowledge of it. Sufficient research and access to proper home loan information can easily fill the gap. Even if purchasing a property at this age seems daunting, it can easily prove as a great income supplement for senior citizens.



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I'm Jethro. I'm a carpenter, and love to build things! You can find me in the garage or at work most days of the week.My sister is Crystal, who you might know from this very blog. Her son Johnny loves video games just as much as I do - so we have a lot of fun playing together!

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