Retirement

Thinking about retiring?

Are you looking for a place to retire, First Vision Real Estate & Financial Services can help with financing options!

Should I downsize my home to a smaller property?

If you are thinking of downsizing your current residence and moving to a smaller property or in other words move from a 2 story to a single-story home, then contact our retirement experts at First Vision Real Estate to discuss your options.

Consider the following questions before moving forward:

• Will I be able to affordable my mortgage payment with my retirement income?
• Will a one-story home be better for my mobility and accessibility?
• Should I move to a retiring community for a more stress-free environment?
• Should I consider moving to another state where prices of homes are more affordable, which will allow me to save some of my equity towards my retirement?

First Vision Real Estate & Financial Services will collaborate with you every step of the way!

Selling your house for retirement, will provide liquidity to be able to afford something manageable for your new lifestyle which will allow you to pay cash for a property in another location. By selling your home can lower your liabilities which will in turn increase your credit scores to get a better interest rate.

Moreover, moving to a more accessible and lower priced area than your current location can be a good decision. Using your equity after selling or cash-out refinancing to keep your existing property and acquiring another affordable property could also be a great retirement decision.

Shall I keep my home and cash-out the equity?

Cashing out the equity will allow you to have accessible cash to live a stress-free retirement life. However, your mortgage payment will go up since your loan balance will increase. It is highly advisable to make sure that you can afford the new payments with your retirement income before a final decision is made.

A solution to this problem could be a Reverse Mortgage which will allow you to access the unencumbered value of the property while you remain in the property with a no mortgage payments due but you will still be responsible for the taxes and insurance.

For more information on Reverse Mortgage, reach out to a First Vision Reverse Mortgage Professional for more help.

What is a reverse mortgage?

A Home Equity Conversion Mortgage (HECM), the most common type of reverse mortgage, is a special type of home loan only for homeowners who are 62 and older.

A reverse mortgage loan, like a traditional mortgage, allows homeowners to borrow money using their home as security for the loan. Also like a traditional mortgage, when you take out a reverse mortgage loan, the title to your home remains in your name. However, unlike a traditional mortgage, with a reverse mortgage loan, borrowers don’t make monthly mortgage payments. The loan is repaid when the borrower no longer lives in the home. Interest and fees are added to the loan balance each month and the balance grows. With a reverse mortgage loan, homeowners are required to pay property taxes and homeowners insurance, use the property as their principal residence, and keep their house in good condition.

With a reverse mortgage loan, the amount the homeowner owes to the lender goes up–not down–over time. This is because interest and fees are added to the loan balance each month. As your loan balance increases, your home equity decreases.

A reverse mortgage loan is not free money. It is a loan where borrowed money + interest + fees each month = rising loan balance. The homeowners or their heirs will eventually have to pay back the loan, usually by selling the home or refinance the mortgage.

Pros and Cons of Reverse Mortgage

Pros of Reverse Mortgages

• Allows the homeowner to stay in the home.
• Can pay off existing mortgages on the home.
• Simple to qualify for because no minimum credit score and generally no income requirements.
• No monthly mortgage payments are required; however the homeowner must live in the home as their primary residence, continue to pay required property taxes, homeowners’ insurance and maintain the home according to Federal Housing Administration requirements.
• The homeowner receives payments on flexible terms:
  • Credit line for emergencies
  • Monthly payments
  • Lump sum distribution
  • Any combination of the above
• A reverse mortgage cannot get “upside down” so the heirs will never be personally liable for more than the home is sold for.
• Heirs inherit the home and keep any remaining equity after the balance of the reverse mortgage is paid off.
• Loan proceeds are not taxable.
• The interest rate may be lower than traditional mortgages and home equity loans.

Reverse Mortgage Cons

• The fees on a reverse mortgage are the same as a traditional Federal Housing Administration (FHA) mortgage but are higher than a conventional mortgage because of the insurance cost. The largest costs are:
  • FHA mortgage insurance
  • Origination fee
• The loan balance gets larger over time and the value of the estate/inheritance may decrease over time.
• Although Social Security and Medicare are not affected, Medicaid and other need-based government assistance can be affected if too many funds are withdrawn (and not spent) in one month.
• The program is not well understood by most individuals. However, the availability of independent reverse mortgage counseling helps.

Thinking of a Reverse mortgage? Call a First Vision Reverse Mortgage professionals for a free consultation!

Moving Out of State and need a mortgage

Getting a mortgage when moving out of state can seem like a daunting task, however many of the considerations of mortgage relocation loans are the same as any other mortgage. By understanding the process and engaging in careful planning, getting a mortgage when moving to a new state or switching jobs can be straight forward.

Here are eight things to consider when relocating:

• Employment Opportunities
• Shift in cost of living
• Housing availability
• Change in taxes
• Healthcare switch
• Moving services
• School quality
• Climate

First Vision Real Estate & Financial Services Company is a willing partner during any relocation or move.

We can offer a few services that will be beneficial to you and more:

• Competitive mortgage interest rates & lending charges/fees.
• Streamlined Loan Management & Support
• Tailored Client Guidance and Mortgage Services.

Reach out to one of our mortgage professionals for our unique First Vision Real Estate & Financial Services relocation guide and solution