Downsizing is a great option for seniors who are looking to make a move, but it can bring a lot of questions even as you’re trying to answer a few. Knowing the right time to downsize is important. You may be thinking about how to make your post-retirement years as safe and comfortable as possible, but it’s important to ensure that your finances are in check and that you’re able to find a home that meets your needs while staying within your budget. This can be tricky depending on the area where you’re looking, so it pays off to do some research before you make any decisions.
Preparing for a downsize can be a lot of work, because it includes not only the packing and moving, but it also means going through all your belongings to figure out what you’ll bring to the new home. Keep in mind that the more items you can discard, the more room you’ll have, which helps eliminate fall hazards, one of the most common causes of injury in seniors.
If downsizing is on the horizon for you, here are a few tips on how to get started.
Check out the area first
If you’re thinking of buying a home in a particular area or neighborhood, it helps to check it out first. You might rent a vacation home there for a week to get a feel for the weather, the people, and the community. This is also a great way to test the waters and see what you’d like to have in a home, from the size to the location. You should also scope out the housing market in the area you decide to live in, to see if you can actually afford to live there. In Bay Shore, average home prices have been an average of $356,000 over the past month.
Don’t overlook the details
It’s important to know what to look for in a new home when you’re downsizing. You may find a great home that’s just the right size, but if the details are wrong, it might not be the best fit for you in the long run. Take a look at all parts of the home. A one-story two-bedroom might just be perfect, but if there’s a large yard to take care of, you may end up regretting it down the road. Does your chosen house sit in a neighborhood with an HOA that will cost potentially hundreds of dollars per year? Are there grab bars in the bathroom? If not, you can always purchase them later, since they’re easy to install. (You can find grab bars on Amazon for $23.37 each.) Make sure you know the ins and outs of the home and the area before making a commitment.
Staying organized while you pack and declutter is essential because it helps keep your belongings separated from the items you plan to get rid of, and because it enables you to reduce stress while you’re preparing for such a major life change. Make packing lists as you go, and clean at the same time so you’ll have less to do on moving day. Try not to make a “maybe” pile when going through your belongings, as it’s best to be definitive. Donate, trash, or sell the things you know you don’t want to take, and measure the rooms in the new house to make sure your furniture will fit.
Get some help
These days, many cities have companies that specialize in helping seniors downsize, so look to see if there’s something like that available for you. These professionals can help you declutter, pack, transport, and unpack your belongings. You can also ask friends and loved ones to help you get everything organized and ready for moving day, and have someone help you clean the old house when all is said and done.
Downsizing is one of the biggest decisions you’ll ever make, so it’s crucial to ensure that you take your time and research your options. Finding the right home for your post-retirement years takes a lot of careful thought, but it’s well worth it if it keeps you safe and healthy.
Written By: Mike Longsdon
If you have just bought a home or are in the process of buying one, you may have a good idea what mortgage insurance is. It is quite possible you’re paying it right now. To make things affordable for homebuyers, one of the prerequisites of opting for a mortgage via any lending organization is getting mortgage insurance on specific varieties of loans.
The fundamental advantage of mortgage insurance is securing the lender and shielding it from a financial risk or uncertainty on behalf of the homebuyer. But it also makes accessibility for the homebuyer easy even if they do not have a truckload of money to pay for it up front. Sure, there is no doubt that acquiring a mortgage with mortgage insurance can help you get your dream house quickly ,however, you have to understand the flipside of it – which is the fact that mortgage insurance payments will stack up higher and higher in the long run.
If you’re getting that butterflies in the stomach feeling, there is no need to worry at all. We have compiled a handful of effective and simple ways to lessen the burden of paying for mortgage insurance. Check it out…
Wrap Your Head Around LTV
Eliminating mortgage insurance heavily relies on what type of loan you have acquired – as well as that loan’s LTV and mortgage insurance specifications and requirements. LTV is short for (Loan-to-Value) ratio, and it basically calculates the amount of equity you have stacked in your home.
You can easily calculate this by dividing the amount of your current loan (the balance that remains) by the original value of your real estate, then multiply the total amount by 100. Remember, the higher the number of payments you make, the lower the loan-to-value ratio. If your LTV is 80% or higher, you don’t have to pay mortgage insurance. This means that if you make a down payment of at least 20% of the home value, you can avoid mortgage insurance.
Paying Mortgage Insurance? Here is How You Can Stop!
For FHA Loans
If you have acquired an FHA loan, you have to understand that you don’t have an option to cancel making FHA loan mortgage insurance. So what do you do? The best way out of this is to transfer your loan into a conventional loan via refinancing. The fastest way to do that is if you have a low loan-to-value ratio or if you have drastically enhanced your credit score.
For Lender-Paid Mortgage Insurance
If you have acquired a lender-paid mortgage insurance, the first thing you have to understand is that no lender is going to be paying for your insurance contrary to what they have advertised. What happens is the lender pays for your mortgage and then asks you to make repayments to cover that cost with a slightly raised interest rate.
Sure, this might have sounded awesome to you when you first acquired the loan. However, you may want to reconsider your refinancing options, especially if you’re eligible for a brand new loan without the need to pay any mortgage insurance, interest, or either.
When the Value of Property Increases
If your vicinity’s market has gone up, and you have already spent quite a bit of money making improvements to your house, your house’ true value (and equity) probably has gone up too since the date of purchase. And this may very well mean that your loan balance falls below 80% of the home value. If this happens, the lender has to remove the mortgage insurance requirement.
So now you know that ditching mortgage insurance is possible. More importantly, you know how to do it. Who doesn’t like canceling a monthly payment? Feel free to discuss this with us and see what’s the best way out of mortgage insurance for you.
When you’re looking for a new home, the first thing you should do is contact us and have us take you on a tour of homes you might like, right? Wrong!
The first thing you should do before you do any house shopping whatsoever is to get pre-approved for a home loan.And before we take a look at why pre-approval is so important, let’s look at the difference between getting a pre-qualification versus a pre-approval because they are not the same thing. One gives you a general idea of what price range you can shop in, while the other gives you the power to fill out the purchase and sale agreement(s) as soon as you find the home you like.
Getting a pre-qualification is the first task in the mortgage process and it’s simple and quick. You supply a lender with the basics of your overall financial situation, such as your how much debt you have, what your income is, and any the value of any assets you might have. This will give you a general idea of how much you may qualify for on a mortgage. But the big point here is that a pre-qualification will not put you in a position to place offers in writing. That’s where the pre-approval comes in. Here are some good reasons why the pre-approval letter from a lender is so important in your home buying search:
- You will save a lot of time (and probably a lot of money spent on filling up your gas tank) because the pre-approval letter from a lender basically says the lender is ready to provide you with a home loan for a certain amount. This reduces the time you have to spend going over home listings. A big time waster for home buyers is looking at a lot of listings while at the same time asking themselves, “I like that home, but I wonder if I can afford it?” Pre-approval takes the wondering out of the equation. It’s like going fishing. If a friend told you he or she wanted to take you fishing and you agreed, where would you go fishing? Without discussing it in detail, you wouldn’t know where to go and neither would your friend. But if your friend asked you to go fishing at a specific lake because they knew that lake is stocked with a specific kind of fish that you like, then you could prepare ahead of time with the right kind of fishing pole, fishing lures and bait, etc. Pre-approvals do the same thing. You can be prepared ahead of time before you go home shopping because your pre-approval gives you an idea of what cities, what neighborhoods and what price range is right for you.
- You also have more buying leverage when you are pre-approved. It is a well known fact that sellers most often accept offers from potential buyers that are pre-approved. It’s like if you were buying a home with all cash from directly from your wallet. If you’re not pre-approved and yet you make an offer to a seller, it’s like showing the seller an empty wallet. Telling a seller you want to buy their home with no pre-approval is just a bunch of hot air, and hot air does not close deals. But if you are pre-approved and you make an offer to a seller, it’s like showing them the same wallet-this time loaded with cash. They’ll know you’re a serious and prepared buyer. And when sellers are approached by a pre-approved buyer, there’s a good chance that there will be room for negotiating on the price too.
- A pre-approval means your lender can get you on the fast track to closing the deal. Appraisals can be ordered right away, and in some cases a 60-day closing can be shortened to 30 days or even down to three weeks. And the potential for a quick closing will look very attractive to a seller who needs to sell fast because they’re being transferred by their employer to a new city, etc.
Because a pre-approval is the most important contingency to satisfy in a purchase agreement, getting that done ahead of time will make home shopping much ease.