The unemployment picture remains bleak. The Department of Labor put the current rate at 9.5%. Seniors, those over 62, who can't find work and have run the course on their unemployment insurance benefits are throwing in the towel and applying for Social Security. Last year more people applied for Social Security than any other year in history; 2,740,000. What is shocking, at least to me is that 72% of the men and almost 75% of the women applied before full eligibility kicked in. Most of us eligible for early retirement today have to be 66 in order for the full benfit amount to be hit.
The question that I have is will these early retirees have sufficient funds to "stay in place" or will they consider moving into smaller, more "senior friendly homes"? I think that many will do exactly that. I made a presentation today for a group of around 50 Realtors many of whom work with seniors. Their feeling is that seniors are looking to downsize but won't be able to pull enough cash out of their current home to pay cash for their retirement home.
Of course, my solution is for the senior to list their older family home and then take a portion of the proceeds and put it down on a new home, financing the balance with a FHA Reverse Mortgage. With the Reverse Mortgage for Home Purchase Program they can usually put less than 50% down and still make no payments for the rest of their lives as long as they remain in their home.
You can do the calculations for yourself by going to my web site @ www.homeloans.com/ken-keranen to see how much a senior is eligible for depending on their age and home value. You simply subtract the eligibilty figure calculated from the purchase price that you have loaded in and that becomes the approximate down payment needed. I feel strongly that more seniors, those unemployed and those now retired, will continue to look at this as a distinct possibility. However, the Program will never truly get off the ground in a big way unless Realtors understand the program and spread the word.
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