Can mortgage company demand payment

Question

This probably won't be an issue, but now that I am retired from my W-2 job and no longer have that income can my lender demand payment?  Also, now that I only have rental property income what are my chances of qualifying for a refi?  I have substantial funds in my 401 k.

Daniel Hennek · Answer

A lender cannot call the note due simply because you retire.  They most likely won't ever know you're retired either, unless you tell them.  And if you tell them nothing happens, nobody will care because it's just not a thing.

Seeking a new refinance is a different animal as guidelines require things you might not be able to provide.  If you haven't been drawing on your 401k it won't be considered for income for conventional loans.  If you've set up monthly draws then that could be counted as income.  Social security will be considered income.  You'll just have to call a good loan officer and talk to them about it.

Kyle J. · Answer

You can always read the note to see what the terms are, but I doubt the lender required you to only make payments as long as you were employed.  So yes, they can still require you to make payments.

And as far as qualifying for a mortgage in retirement, you can still do that.  Here's a couple articles on how that can work depending on your specific situation:

How to get a mortgage during retirement

Getting a Mortgage After Retirement