A Guide to Buying a Home for Older Adults

Retirement


Perhaps you thought you’d be settled into a paid-off home by the time you retired, but the truth is, many adults choose to buy a new home in their senior years. Whether purchasing your first home, downsizing to a smaller dwelling, or shopping for a home suited to aging in place, buying a house as a senior requires some special considerations. This guide will help you make a smart purchase that serves you for years to come.

 

Searching for a Home

Unless you plan to move again, you need a home that’s just as livable in 30 years as it is today. That means you must account for the ways your health and mobility will change with age. Even if you’re in great health now, be conservative and purchase a home you can live in even if you become disabled. If you unexpectedly become injured or seriously ill and you don’t have a safe place to live, you’re likely to end up in a nursing home.

 

A home that’s suitable for aging in place should have a master bedroom and bathroom on the first floor, with an exception for homes with elevators. There should be parking near a main entrance with no stairs between the parking space and the front door. Ample natural lighting is ideal, as are hard floors and low-pile carpeting. Plush floors pose trip and fall hazards to seniors with mobility challenges.

 

While it’s tempting to move to a more rural location to save on housing, consider that you may lose the ability to drive in old age. By opting for a centrally located home instead, you can walk and take public transit if you’re unable to drive, which can reduce the likelihood of social isolation.

 

It’s true that centrally located homes tend to be more expensive. Do your research so you understand average prices in your area and what you can afford. In the town of Lutz, Florida, the average sale price for a home is $280,000. However, buying in the heart of town doesn’t have to mean exceeding your budget. For a more affordable home, look into smaller houses as well as condos and townhomes. Not only is a downsized home more affordable, it’s also easier to upkeep as you age.

Financing a Home

If you’re selling a house and downsizing, you may be able to use the proceeds of your home sale to purchase a new home or put a large down payment on a home. However, that’s not possible — or the best option — for all seniors.

 

As the New York Times explains, “An increasing number of older Americans prefer to have a mortgage. They may have the means to buy with cash but choose instead to take advantage of prevailing low interest rates and tax breaks, while freeing up their savings for other uses.”

 

If you do apply for a mortgage, know you’ll need the stable monthly income to back it up. Social Security payments, pensions and investments can count toward your income. If you’ll have adult children or other family cohabiting with you, you can include their income when qualifying for a HomeReady mortgage with Fannie Mae.

 

If leaving a home to your children isn’t a priority, consider a reverse mortgage for purchase, or HECM. This program lets older adults purchase a home without monthly mortgage payments, but it requires a sizable down payment. Kiplinger explains the HECM program in detail.

Finding Help

Many seniors feel that purchasing a home late in life is more complicated than when they were younger. Thankfully, there are professionals trained specifically to assist senior homebuyers. For help finding a home, seek a real estate agent who specializes in working with seniors. You should also seek a mortgage originator experienced with mortgage programs like HECM and the mortgage approval process for seniors on a fixed income.

 

Doing your own research before buying a home is important. However, seniors shouldn’t underestimate the value of hiring the right experts to help them find and finance a home. Once you know what you want in your future home, reach out for help navigating this often-confusing process.

 

This post was written by our guest author Hazel Bridges of AgingWellness.org Ms. Bridges is the creator of AgingWellness.org, which aims to provide health and wellness resources for aging seniors.

Photo by Matthew Bennett on Unsplash

5 Reasons to Refinance Your Home Now

Refinance your Tampa Florida Mortgage

Most Americans largest debt payment on a month to month basis is their mortgage. While it’s a large portion of their debt very few people have their mortgage reviewed on an annual basis by a mortgage professional. Roughly 56% of the country has a mortgage currently and most utilize fixed rates for 30 and 15 year terms.

Since there are several reasons a homeowner may choose to refinance, let’s look at 5 of the best reasons.

 

1. Restructure your existing mortgage.

Some people aren’t very pleased with their existing mortgage or mortgage servicer. In 2017 mortgage servicer satisfaction fell slightly. Restructuring your mortgage through a new company can not only reset your terms but can also get you out of an unhappy relationship with your current lender or servicing company.

 

2. Your credit score has improved since your purchase.

According to credit.com the average credit score of American’s in 2016 was a 673. Prime credit for a mortgage is considered to be 740 or higher. A 50 to 100 point difference can mean a difference of thousands of dollars over the life of a mortgage. With buyers being more credit conscious and great tools like Credit Karma and monitoring services offered it’s not difficult to see where your scores can improve and make those changes. If your credit has drastically improved since you’ve obtained your mortgage you are the perfect candidate for a refinance.

 

3. Home improvements are on the horizon.

If you’ve owned your home for a year or two and have built up equity you have a great opportunity to utilize that equity to improve your home. With interest rates still very low in relation to the past, more homeowners are utilizing refinances as a means to fund their home improvements. Nerdwallet notes that while a HELOC or home equity line of credit can be okay for small improvements you can potentially save a large chunk of money by utilizing a cash out refinance.

 

4. Lower your interest rate.

Depending on when you initially bought your home your rate could substantially decrease through a refinance saving you thousands over the life of your mortgage. With rates holding fairly steady right now at almost all time lows and an increase on the horizon due to the recent decision by the Fed now is an incredibly good time to refi and lock in a lower loan rate for the long haul. We often find a large amount of savings for buyers looking to refinance.

 

5. Remove your private mortgage insurance.

Unless you put 20% down on your existing home you likely have a PMI or private mortgage insurance amount included in your monthly mortgage payment. Normally to remove your PMI you need to have at least 20 percent equity in your home. Once a conventional loan is paid to 80% of the home’s value you may request that the PMI be removed. When the balance drops to 78 percent, the mortgage servicer is required to remove the PMI. FHA mortgages are not included in this scenario. Interest rates are set to rise again in 2018 so now is a great time to refinance and remove your PMI while locking in potential savings over the life of the loan.

Get in touch with us today to discuss your refinance and we’ll be happy to help! Call 813-302-1616 or contact us to get started.