Can a Retired Person Get a Mortgage in Canada?

Retirement doesn’t mean the end of homeownership dreams. You may be wondering: Can a retired person get a mortgage in Canada?The answer is yes, but there are a few extra steps and considerations involved.

Let’s walk through how retired Canadians can qualify for a mortgage, the types of mortgage options available and tips to improve your chances of approval.

Can retirees qualify for a mortgage in Canada?

Yes, lenders in Canada will work with retirees. However, qualifying is based less on your age and more on your income, creditworthiness, debt obligations, and the property itself. Since most retirees live on fixed incomes (like pensions, CPP, OAS, or RRIF withdrawals), proving your ability to repay the mortgage is key.

What lenders look for when qualifying.

Here’s what lenders will assess when a retired person applies for a mortgage:

Income Sources
Lenders will consider:

• Canada Pension Plan (CPP)
• Old Age Security (OAS)
• Employer pensions
• RRSP/RRIF withdrawals
• Investment income
• Rental income
• Spousal income (if applying jointly)

Credit Score & History
A good credit score helps demonstrate that you’re financially responsible. If you’ve managed your finances well, you’re already ahead.

Debt-to-Income Ratio (DTI)
Lenders will review how much of your income goes toward existing debts like credit cards, lines of credit, or car payments. A lower DTI improves your approval odds.

Down Payment & Equity
A larger down payment or significant equity in a current property can help reduce the lender’s risk and may secure you a better interest rate.

Mortgage Options for Retired Canadians

Here are some of the most common mortgage types retirees may consider:

Traditional Mortgage
If your income and credit qualify, you can get a regular mortgage with fixed or variable terms, just like anyone else.

Reverse Mortgage (CHIP Program)
Available to homeowners 55+, a reverse mortgage allows you to borrow against your home’s equity without making monthly payments. Repayment is only required when you sell the home or pass away. 

Home Equity Line of Credit (HELOC)
If you have substantial equity in your current home, a HELOC allows you to borrow as needed, with interest-only payments. This offers flexibility but requires good credit and income.

Co-signing or Joint Mortgage
Retirees can also apply with an adult child or spouse with stronger income to help qualify for a better mortgage amount or rate.

Net worth Mortgage

Did you know that you may be able to buy a home with your net worth? Read more about this program and how it’s possible by reading my blog “Buying a Home with Your Net Worth.”

Tips to Improve Approval Odds

If you’re hoping to get a mortgage as a retiree, here are a couple more things you can do to help yourself. 

• Pay off other debts to lower your DTI ratio.
• Make a larger down payment to reduce how much you need to borrow.
• Work with a mortgage broker who understands retiree income sources and can access a wide variety of lenders.
• Consider a co-signer if your personal income isn’t quite enough.

If you work with Mortgage Okanagan, I’ll go through your full situation, and I’ll be able to guide you in the right direction. If there are things that need to be paid off before the mortgage, I’ll let you know! I’ll be with you every step of the way to make your mortgage process smooth. 

Let Mortgage Okanagan Help

Yes, retired Canadians can absolutely get a mortgage and often do. Whether you’re looking for a change of pace, want to be closer to family, or simply need more financial flexibility, there are mortgage options available.

If you’re ready to explore mortgage options as a retiree, reach out to me today. Give me a call at 250-826-3111, apply on my website or contact me through my online contact form to start the process today.