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> It’s a secured asset, so if you turn 65 and need to go into a nursing home for some , or die, they’re confident they can recoup the balance of the loan from t

> It’s a secured asset, so if you turn 65 and need to go into a nursing home for some , or die, they’re confident they can recoup the balance of the loan from the house when it is auctioned off or sold to another family member. Thanks for noting this, this was definitely a possibility I hadn't weighed enough, though I'm not sure it's always another family member (I assume you meant another family member or any random bidder) > Banks do not engage in age discrimination in giving mortgages. You can get one at age 20 or age 60, all else being equal. I find it hard to believe the suggestion here that as far as 30y loan repayment goes, all else equal, a 60 year old earning 70k a year is similarly risky to a 20 year old earning the same rate? From first principles, this clearly doesn't hold. Now, I assume you were referring to the illegality of considering age in loans -- it is illegal to consider age, but in this case the "age discrimination" is baked in -- because it's built into credit scores[0][1]. The common sense take prevails here, I think. Actual results on the ground often differ from what is and isn't legal/right, as anyone who is in an underrepresented class will attest to (I do not mean this in the preachy liberal sense, it's just the best way I can find to say it), I think this might be one of those cases (guess I'll find out when I'm 60?). [0]: https://www.aarp.org/money/personal-finance/mortgage-rejection-rates-spike-as-you-age/ https://www.aarp.org/money/personal-finance/mortgage-rejecti... [1]: https://www.philadelphiafed.org/-/media/frbp/assets/working-papers/2023/wp23-03.pdf https://www.philadelphiafed.org/-/media/frbp/assets/working-...

toast0 1y ago
The aarp link seems to basically say that a lot of seniors are having loans rejected because of low reported income, so be sure to report retirement income. The philadelphia fed link notes that older people who apply for loans are being denied more often, but there's lots of potential reasons for that. Aggregate economic stats, other than credit score, in the table at the end look worse to my eye near the top age brackets (but maybe not at the same levels that rejection started climbing). It's not clear to me when it says age discrimination is prohibited, but mortality expectations are allowed. Seems like the same thing to me. The paper suggests there may be an element of selection, which resonates with me. Looking at my parents and their siblings, most all of them would have had a mortgage 30 years ago and likely be in these statistics; now, those with higher retirment incomes also seem to be the ones that paid off their mortgages and aren't interested in a new one.
- trollbridge 1y ago
  Interesting paper. Note that elderly people were only 5% or so more likely to get rejected - statistically significant, but not a big difference. Right now I imagine the average “Baby Boomer” is more creditworthy than the typical Gen Z borrower.

toast0 1y ago

The aarp link seems to basically say that a lot of seniors are having loans rejected because of low reported income, so be sure to report retirement income. The philadelphia fed link notes that older people who apply for loans are being denied more often, but there's lots of potential reasons for that. Aggregate economic stats, other than credit score, in the table at the end look worse to my eye near the top age brackets (but maybe not at the same levels that rejection started climbing). It's not clear to me when it says age discrimination is prohibited, but mortality expectations are allowed. Seems like the same thing to me. The paper suggests there may be an element of selection, which resonates with me. Looking at my parents and their siblings, most all of them would have had a mortgage 30 years ago and likely be in these statistics; now, those with higher retirment incomes also seem to be the ones that paid off their mortgages and aren't interested in a new one.

trollbridge 1y ago
Interesting paper. Note that elderly people were only 5% or so more likely to get rejected - statistically significant, but not a big difference. Right now I imagine the average “Baby Boomer” is more creditworthy than the typical Gen Z borrower.