Many seniors are realizing that they are not going to be as comfortable in retirement as they thought they would be. Rather than being able to relax in their autumn years, they have to face the rather stark economic reality that they do not have sufficient income to live on.
But many are sitting on a very valuable asset that could help them. The home that they own. There are two ways to turn this asset into cash. The first option is to simply sell it and move to a smaller property. The second option is to get a reverse mortgage and remain in the existing house.
A reverse mortgage can be taken as either a lump sum or regular monthly income. There are no monthly repayments to be made, unlike a regular mortgage. Instead the amount borrowed is repaid when you actually sell the property, pass away or move out.
There is no best solution for everyone as circumstances vary. But some of the questions that you should ask yourself include:
How much is my house worth if I were to sell it
How long will it take to sell?
What type of smaller property could I buy and at what price?
What would be the surplus that I am left with (after paying legal and real estate fees)?
Would I benefit from moving to a smaller, more manageable property?
It may take some time to come to a decision. It is recommended that any senior considering their future should talk over the options with their family and a housing counselor. Even with all the financial facts in front of you, it may come down to an emotional decision. Some folk just do not want to move out of the house that they have lived in for the last 30 years.