December 21, 2010
There are many myths to dispel about FHA home loans. The most popular ones include the notion that the FHA actually lends money (it doesn’t) and the idea that if you earn “too much” money you can’t apply for an FHA mortgage (you can).
There are also myths about age. According to FHA rules, there is no maximum age limit for FHA borrowers. Anyone who qualifies for an FHA home loan is eligible to apply regardless of how old they are. All income, credit, and occupancy rules apply to FHA borrowers regardless of age, but there is no “cut off” point where the government would refuse to guaranty a loan simply because of how old the applicant may be.
The reverse is not true–FHA rules do recognize a minimum age, but the standards for that age aren’t set by the federal government. Instead, the FHA minimum age rule states the borrower must be of legal age based on the laws of the state where the loan would be issued. If the borrower is at the age where the mortgage can be legally enforced, he or she is eligible to apply for an FHA loan.
The minimum age scenario would most likely come into play in cases where an adult buyer wanted to include a younger relative on the mortgage. The reasons for wanting such an arrangement could include trying to build up a credit history for a recent high school or college graduate or to make arrangements for the property to be owned by the co-borrower in the event of the older applicant’s death or disability.
As long as the co-borrower is legally able to sign, the FHA does not require they be of a specific age in most cases.
There is an FHA home loan that requires a minimum age. Home Equity Conversion Mortgages (HECM) are designed specifically for borrowers age 62 or older, and proof of age is required for these loans. HECMs require the borrower to be age 62 or older at the time they sign the loan application.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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