Written by Jim Vogel
Buying a new home as a senior is not always an easy task. Not only do you need to find the right home - in terms of size, accessibility, and location - but you also need to find a way to finance your new home without breaking the bank or putting yourself
in a situation where you’re struggling to make ends meet on a month-to-month basis.
After helping my mother through this lengthy and somewhat difficult process, I realized that not every senior out there has a family member who can help them when it comes to buying a new home. Because I think our senior population deserves as much assistance
as we can give them, I decided to share what I found and what helped.
Here are some things you need to be 100% sure of when purchasing a new home.
How you are going to pay for it
If you have a good amount of money in savings and you want to use it on a new home, then you can possibly go the normal mortgage route. Of course, many seniors don’t have enough in the bank to pick up an expensive monthly mortgage payment (their current
houses may be already paid off). If you’re living on a fixed income or have not accrued a decent nest egg, you may have to think about different options if buying a new home is part of your late-life dream.
The good news is that there is help out there. The Federal Housing Administration (FHA) offers a handful of loans that can help in certain scenarios. If you’re a first-time home buyer, for instance, an FHA loan can offer
low down payments,
low closing costs, and easy credit qualifying.
Do you currently own a home and want to move to a new one? Maybe a reverse mortgage purchase is right for you.
USA.gov says “are you 62 or older? Do you live in your home? Do you own it outright or have a low loan balance? If you can answer ‘yes’ to all of these questions, then the FHA Reverse Mortgage might be right for you. It lets you convert a portion of your
equity into cash.”
That cash can be used as a down payment on a new house using a HECM reverse mortgage buyers programs.
“With the HECM for Purchase program, instead of getting the reverse mortgage on your current home, you would inform your reverse mortgage lender that you wish to buy a new home using the reverse mortgage. The lender will then calculate the amount of money
you qualify to receive as though you already owned the property,” says NewRetirement.com
You wouldn’t have to pay any forward mortgage payments. The loan on the new home would only be due if you die or move.
What you need in a new home
Do you have mobility issues? Are you downsizing because the upkeep on your current home is too much (and do you therefore need to put some things in storage
)? Do you just want
to move to be closer to your kids and grandkids? You need to be 100% sure of exactly what you want in a new home. Do you need a home with first-floor access to all major amenities? Do you need a home without any yard maintenance? Do you need a home that
is small enough to get around with limited mobility? Make sure you know why
How you’re going to execute the actual move
This is a big one - from packing up and moving boxes and furniture, to paying for professional movers, to scheduling moving trucks and vans. Buying the home is only half the battle. For seniors, the actual physical move can be just as taxing as the financial
It’s recommended that you start small and move gradually. Take help when you can get it with the big stuff and try to give yourself a buffer between closing dates on your current and future homes.
While moving in your golden years is definitely a major undertaking, there are ways to make it less arduous and more streamlined. Having the right information at your fingertips can make it a much smoother transition.
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