SHOULD YOU STAY OR
SHOULD YOU GO?
Staying Put: Packing up and selling a loved
home with so many memories is a difficult
decision for many longtime Dallas residents.
One viable option open to senior homeowners is the reverse mortgage, which allows
homeowners to turn the value of their home
into cash without having to move or repay
the loan each month. Guaranteed by the U.S.
Department of Housing and Urban Development, HUD offers seniors a federally insured
private loan as a means to provide financial
security and supplement social security, meet
unexpected medical expenses, make home
improvements, and more.
The money from a reverse loan may be paid
to the borrower in a variety of ways: a lump
sum, a regular monthly cash advance, as a
credit line account or in any combination
of the above. Typically, borrowers do not
have to pay anything back until they permanently move out of the home, sell, or pass
away. Eligibility for most reverse mortgages
requires that the home should be owned
outright by the applicant, and that the
applicant is 62 years of age or older. (Visit
AARP’s website and use their Reverse Mortgage Calculator: www.aarp.com).
A reverse mortgage offers retirees a distinct
advantage. Since most lenders determine a
borrower’s ability to pay back the loan by
reviewing the borrower’s income, many retired
seniors simply cannot qualify for a traditional
home equity loan. But a reverse mortgage does
not require monthly payments, and therefore
no minimum amount of income is required
for the loan application. Most reverse mort-
gages require no repayment as long as the
owner, or any co-owner, lives in the home.
The best way to determine if a reverse mort-
gage is the best fit for one’s retirement plan
is to honestly assess the following:
• How much would the home sell for on
today’s market?
• What would the cost be to buy and
maintain, or rent, a new home?
• Would there be any money left over
from the purchase of a new home that
could be safely invested?
• What are the options for downsizing
into a less expensive home, renting an
apartment, or moving into an assisted
living or alternative senior housing
situation?
Borrowing money for a reverse mortgage is not
advised until looking into all of these senior
living options. By being honest about current
needs and housing trends, and exploring all
the options, seniors can be assured that they
have selected the best housing choice that
uniquely fits their budget and lifestyle needs.
PACK IT UP
Being realistic about your life, finances and
longevity is a must if you decide to move to
another community, says Calvin Chamness,
real estate agent/developer/builder with JW
Development Inc. He advises, “You have to
think about your health and your future and
expand your thinking beyond the average
life expectation. Make sure that you’re close
to hospitals and doctors that can provide
you with the best care. Do they accept your
insurance? All of this needs to be considered
when moving from your current circle of
friends and community to a new area. This
is where a real estate agent can really help a
person or family trying to find a retirement
situation for someone, as they have access
to the most current facts and figures to help
you make an informed decision.”
“Many who are making these decisions for
themselves need to learn to be a little bit
selfish,” says Chamness. “I mean, be selfish in a
good way,” he laughs. “Move to a community
or area that you enjoy. Many of my senior-aged clients are downsizing their lifestyles and
selling a home they’ve owned for 30 years.
They’re trading down in price range, want to be
in a good area and need to select a home that’s
a good investment for them. If your health is
good, and you’re reasonably active, you also
want an area with residents of a similar age
and situation – just like you, they’ve raised
their kids, have a lot of interests and a lot to talk
about, and can help each other.”
SENIOR HOUSING OPTIONS
According to Paying for Senior Care (www.
payingforseniorcare.com) private senior care
housing nationwide is approximately average
$3,600 per month, depending on the services
and degree of care offered by a facility. Many
senior care housing communities employ
medically trained staff, provide housekeeping and meal prepa-ration services, as
well as transportation for shopping, medical
visits, and social outings. HUD also notes
that as Baby Boomers approach their own
retirement years, the trend toward creating
