Portland Oregon Older American's and Reverse Mortgage to secure Retirement nest egg
Have you been considering downsizing because your Accountant or Financial Planner informed you that you can no longer afford your home? Or are you worried about not having an emergency nest egg in your Retirement?
Today I will share with one option that you may not have explored yet, or may not know the truth about. New Purchase money made available to Older American's in Portland Oregon that are 62 or older. Yes, you can downsize or up-size to meet your current needs without a monthly mortgage payment.
Today 10,000 people will turn 62 and the vast majority have lost their nest egg because of reasons beyond their control. In a recent poll 88% of voters are worried about "being able to maintain a comfortable standard of living through out retirement".
Mr. and Mrs. Cozby left their annual meeting with their Financial Planner in Portland Oregon devastated because they were informed that their best option was to sell their home of 35 years and either downsize or consider renting. Their Financial Planner suggested they explore their options with a HECM (Home Equity Conversion Mortgage). After meeting with Mr. and Mrs. Cozby I showed them an option that their trusted adviser agreed with.
Their current home was valued at $400,000 according to the current market conditions. However,with the help of their Realtor they found a single story home in a safe community that fit their needs and was easier to maintain that was on the market for $250,000. Based on the age of the youngest borrower of 72 the Cozby's could purchase the new home with a down-payment of $85,520 together with the FHA HECM purchase money of $161,480 to purchase the home and have no monthly mortgage. Since the Cozby's did not have a mortgage balance on their departing home they were able to put $314,480 away for an emergency nest egg. They hold the title to the home they purchased, the new home will allow them to age in place and they created an emergency nest egg that they did not have before.
Sell departing home: $400,000
Deposit$ 314,480 into an account as an emergency nest egg
Purchased new home for $250,000 (capitalizing on the down market)
HECM Purchase money $161,480
Down Payment for departing home: $85,520
Total Purchase price of new home $250,000
NO MONTHLY PAYMENT and $314,480 in the bank.
The Cozby's chose a fixed rate product that accumulates interest at 5.06 with a Total Annual Loan Cost Rate of 2.874 if they live in the home for 13 years with zero appreciation rate. These charges typically include principal, interest, closing costs, mortgage insurance premiums, annuity costs and servicing costs (but not disposition cost when you sell the home.
In future blogs I will share a story of another client who used their existing equity to purchase a second home closer to the Children and Grandchildren and spend the winter in a warmer climate.
How much do you need to put down to purchase your new primary residence? Visit my website for a free calculator! Since the program is age based the older you are the more you qualify for.
As a Home Equity Expert I have been helping Older American's get more out of their retirement for 11 years. I love my job!
Please call me for a no obligation free consultation at 541-891-5706.
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