BUILDING A PATH TOWARDS AGING IN PLACE
While you and your husband have not changed your minds about spending the rest of your lives at home (as opposed to moving into a retirement facility apartment), following a series of lengthy meetings with contractors of various types, you may have changed your thinking about where this “aging in place” will in fact take place. With your three children and their offspring are spread out in different states (you travel to visit them, rather than them visiting you). Your three-story house is not only far larger than you need, but the property has far too much acreage. Even with a “facelift”, you’ve come to realize, this home is not really going to be suitable for your future lifestyle needs.
As a next step, the two of you began looking at homes for sale, both in your present neighborhood and in the newer suburbs northward. Knowing that some friends had worked with building contractors to design a home tailored to their tastes, you’ve even considered going that route. You know your present home has appreciated considerably in value. From a financial viewpoint, in addition to your respective retirement plans (yours 403b, his 401k), you have a jointly owned portfolio and cash account. Still, you are concerned about managing all the financial aspects – not to mention the logistics of selling one home, building another, and moving.
In your quest to age in a home of your own, but in one more suitable for a senior lifestyle than your present pace, building, as opposed to purchasing, can “buy” you the time prepare your present home for sale. A HECM for Purchase is a financing option that allows you to use a reverse mortgage to pay for up to half the total sale price of a new home. In a single transaction and one (not two) set of closing costs, you complete your new home purchase and your mortgage. So long as you continue to live in that new home, taking care of property taxes, homeowners’ insurance, and maintenance costs, and any HOA fees, you will not be required to make monthly mortgage payments* on your reverse mortgage.
You might consider moving forward by taking two steps:
Contract with a builder and make the down payment. (Typically, you will not need to come up with the rest of the purchase price until the home is finished.)
Get prequalified for a special type of reverse mortgage – a Home Equity Conversion Mortgage for Purchase (which you will not use until a Certificate of Occupancy is issued and it’s time to take possession of your new home).
You will be avoiding participating in the “bidding wars” that often accompany the quest to purchase an existing home, all while “locking in” the purchase price of your future home, all with an eye towards building a path towards aging in place.
https://mutualreverse.com/david-garrison
*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees. David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from