Getting a Line of Credit after retiring

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Getting a Line of Credit after retiring

Rich Parisi
Member since 2026 · 2 posts · 4 votes

I recently retired but want to continue to drive income through real estate investing.

My goal was to use the good amount of equity in my current home to finance the first purchase but my bank won't lend without a current income stream. Any suggestions other than going hard money?

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Ashish AcharyaBusiness Member
CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
1mo

A few paths besides hard money are worth exploring here. A HELOC on your home, rather than a full cash-out refi, sometimes has more flexible qualification since it's underwritten differently by some lenders and can lean more heavily on home equity and credit than active income. A DSCR loan on the property you're buying is another option since it qualifies based on the property's rental income rather than your personal income stream, that sidesteps the "no current income" problem entirely since it's the deal itself being underwritten, not you.

On the tax side, whichever route you use to pull equity from your primary home, keep those funds traced clearly to the investment purchase, that's what keeps the interest deductible against the rental income once it's placed in service. Since you're retired, also worth checking whether any retirement account distributions or other income sources you do have might affect how a lender views your qualifying income differently than "no income" the way it might be showing on paper, that's worth clarifying with a mortgage broker who understands retiree-specific underwriting rather than assuming a standard conventional lender's rejection is the final word.

Happy to connect!

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  • Stacy RaskinBusiness Member
    Lender · Member since 2022 · 1k+ posts · 495 votes
    1mo

    Do you have any current rental properties? If you currently own a non owner occupied rental property, you can do a DSCR cash out refinance and the loan will be structured on your middle mortgage FICO credit score and if the leased rent for the property "pays for" or covers the new mortgage, property taxes & insurance (and an HOA if there is one). You can use then use the cash out to help with down payments on new DSCR mortgages for more rental properties.

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  • Rich Parisi
    OP
    Member since 2026 · 2 posts · 4 votes
    1mo

    Thanks for the reply. No rentals yet, just my personal.

    0Reply
  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    1mo

    A few paths besides hard money are worth exploring here. A HELOC on your home, rather than a full cash-out refi, sometimes has more flexible qualification since it's underwritten differently by some lenders and can lean more heavily on home equity and credit than active income. A DSCR loan on the property you're buying is another option since it qualifies based on the property's rental income rather than your personal income stream, that sidesteps the "no current income" problem entirely since it's the deal itself being underwritten, not you.

    On the tax side, whichever route you use to pull equity from your primary home, keep those funds traced clearly to the investment purchase, that's what keeps the interest deductible against the rental income once it's placed in service. Since you're retired, also worth checking whether any retirement account distributions or other income sources you do have might affect how a lender views your qualifying income differently than "no income" the way it might be showing on paper, that's worth clarifying with a mortgage broker who understands retiree-specific underwriting rather than assuming a standard conventional lender's rejection is the final word.

    Happy to connect!

    [email protected]941-914-7779
    INVESTOR FRIENDLY CPA®5241 Reviews
    WebsiteView Page
    TaxMD™ | AI-Powered Tax Planning
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    1Reply
  • Jules Aton
    MD/DC · Member since 2024 · 1k+ posts · 1k+ votes
    1mo

    I’ve never been a fan of tying up my home with business deals. If you aren’t someone with a lot of financial cushion especially since you are retired I personally wouldn’t recommend buying an investment property as an income source. Beware because you will likely have people willing to help you to their own benefit. 

    1Reply
  • Bryan MaddexBusiness Member
    Lender · Charlotte, NC · Member since 2015 · 159 posts · 76 votes
    1mo

    There are "no income" helocs on the market!  Usually you are limited to 60% or 65% loan to value with these, and rates will be higher, but if you have no reportable income they are better than a stick in the eye!

    Higher rates = cost. 
    Not tapping the equity could = opportunity cost. 
    Just gotta measure the potential to see if the higher cost is worth it. 

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  • Kevin Aumack
    Glassboro, NJ · Member since 2025 · 37 posts · 13 votes
    1mo
    Quote from @Rich Parisi:

    I recently retired but want to continue to drive income through real estate investing.

    My goal was to use the good amount of equity in my current home to finance the first purchase but my bank won't lend without a current income stream. Any suggestions other than going hard money?

    Hi there. Without traditional earned income, you may need to look outside conventional financing since those loans have specific income-qualification requirements.

    One option is a DSCR loan, which focuses primarily on the property's projected rental income rather than your personal income. You could also look into asset-depletion/asset-based mortgage programs, which may allow eligible brokerage or retirement assets to be used to help qualify.

    I'd compare those options before jumping to hard money. Also make sure you maintain sufficient reserves for renovations, vacancies, unexpected property expenses, and your personal liquidity needs rather than putting too much of your available capital into the purchase.

    I work with a mortgage professional who handles DSCR and alternative financing options, and she'll go above and beyond to explore the options that may be available to you. If you'd like, I'd be happy to connect you with her.

    0Reply
  • Adam S.
    Member since 2026 · 72 posts · 30 votes
    1mo
    Quote from @Rich Parisi:

    I recently retired but want to continue to drive income through real estate investing.

    My goal was to use the good amount of equity in my current home to finance the first purchase but my bank won't lend without a current income stream. Any suggestions other than going hard money?


     Do you have any income coming in? Do you have any hard assets you can pledge as collateral?  How about a brokerage account? Can you use margin; if needed?  

    0Reply
  • Ray WilliamsBusiness Member
    Lender · Denver, CO · Member since 2017 · 148 posts · 68 votes
    1mo

    Rich, the DSCR and asset depletion suggestions above are the right direction, so I'll add the practical detail that decides whether either actually gets you approved.

    Since you don't have any rental history yet, know that a lot of DSCR lenders add a first time landlord overlay. That usually means a bit more down, sometimes 25 to 30 percent instead of 20, and extra reserves in the bank after closing, since you don't have a track record showing you can manage a rental yet. It's not a dealbreaker, just something to budget for so you're not surprised at the term sheet stage. Make sure the broker you work with confirms this is not a problem before getting too deep. I have seen that blow deals up when people come to us after.

    On asset depletion, here's roughly how the math works: a lender takes your qualifying liquid assets (minus down), retirement accounts usually get discounted for early withdrawal penalties and taxes, divides by a set number of months, often 60 to 120 depending on the program, and that monthly figure becomes your qualifying income. It's a real path and doesn't require you to sell anything, but the assets have to actually be there, documented, sourced and seasoned like any other funds a lender counts.

    Between DSCR and asset depletion, I'd run the numbers on a specific property both ways since the better option really depends on the deal and your asset mix. I underwrite these for a living and this exact first deal after retirement question comes up more than people think.

    0Reply
  • Nicola Mislinski
    Lender · Charleston, SC · Member since 2025 · 35 posts · 4 votes
    1mo

    Rich, what state is your current primary located?

    0Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    1mo
    Quote from @Rich Parisi:

    I recently retired but want to continue to drive income through real estate investing.

    My goal was to use the good amount of equity in my current home to finance the first purchase but my bank won't lend without a current income stream. Any suggestions other than going hard money?

    Welcome to the community, Rich! Before going the hard money route, I’d talk with a few investor-focused lenders about a DSCR loan. Those typically qualify the loan primarily based on the rental property’s projected cash flow rather than your personal W-2 income, so retirement by itself doesn’t necessarily prevent you from financing a deal. You could also look into asset-depletion loans if you have substantial retirement or investment assets, or a HELOC through a lender that will consider retirement income, Social Security, pensions, or investment distributions differently than your current bank does. Seller financing is another option if you find the right property and seller. I’d shop around before assuming your bank’s answer is the answer everywhere because lending guidelines can vary quite a bit. Happy to connect and answer any questions you have!
    [email protected]614-300-7535
    Jimmy Lieu, Red 1 Realty4.9120 Reviews
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    1Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    1mo
    Quote from @Rich Parisi:

    I recently retired but want to continue to drive income through real estate investing.

    My goal was to use the good amount of equity in my current home to finance the first purchase but my bank won't lend without a current income stream. Any suggestions other than going hard money?

    Welcome to the community, Rich! Before going the hard money route, I’d talk with a few investor-focused lenders about a DSCR loan. Those typically qualify the loan primarily based on the rental property’s projected cash flow rather than your personal W-2 income, so retirement by itself doesn’t necessarily prevent you from financing a deal. You could also look into asset-depletion loans if you have substantial retirement or investment assets, or a HELOC through a lender that will consider retirement income, Social Security, pensions, or investment distributions differently than your current bank does. Seller financing is another option if you find the right property and seller. I’d shop around before assuming your bank’s answer is the answer everywhere because lending guidelines can vary quite a bit. Happy to connect and answer any questions you have!
    [email protected]614-300-7535
    Jimmy Lieu, Red 1 Realty4.9120 Reviews
    WebsiteView Page
    0Reply
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