| On one weekend, a Saturday in particular, I decided to | | | | mortgage is a special type of home loan that lets a |
| attend a seminar on home remodelling. I Usually prefer | | | | homeowner convert a portion of the equity in his or |
| to call it home renovation. It was basically for the | | | | her own home into cash. The equity built up over |
| elderly people. | | | | years of home mortgage payments can be paid to |
| Am not in the elderly bracket but I decided to attend | | | | the owner, but unlike traditional home equity loans or |
| anyway because I was feeling a bit lonely and wanted | | | | second mortgages, no repayment is required until the |
| to be occupied. On looking around the room, I saw that | | | | borrower no longer uses the home as the principal |
| most people were in my age group. | | | | residence. |
| Think it is because they have to meet most of the | | | | Reverse mortgages are available through different |
| cost for refinancing the renovation of the home of | | | | lenders, as well as HUD. There are some property |
| their old ones. | | | | restrictions, but single-family homes, two-to-four-unit |
| This seminar turned out to be good to me and at the | | | | properties, condominium units, townhouses, and some |
| end I was convinced it was a good take. | | | | manufactured homes are eligible. Generally, the greater |
| In this seminar, it was revealed that research so far | | | | the value of the home, the older the owners, the lower |
| shows this: | | | | the interest rates, and the more one can borrow. This |
| It will probably cost anywhere from $100,000 to | | | | is good news right now, with interest rates so low, and |
| $150,000 to do a good renovation of a house for the | | | | it is an opportunity for your patients who have a higher |
| elderly. This seems a staggering amount, until you | | | | annual income that disqualifies them from other |
| consider that it would cost them from $3,000 to $5,000 | | | | programs. And if they live in an area of the country |
| per month if they were to rent a unit in a retirement | | | | where land or home values are traditionally higher, such |
| facility in a location where they might not be as happy. | | | | as Hawaii or New York, it may be the best option |
| Looking at it from that point of view, in four years or | | | | available for refinancing. |
| less, they would have spent the money anyway, and | | | | Given the sheer amount you have to invest or borrow, |
| at least making home improvements allows them to | | | | here is a checklist before you decide on any |
| continue to live in the same location and keep their | | | | renovation project. |
| asset. | | | | Consider the following before you decide how to |
| The biggest challenge many older adults face when | | | | finance your home improvement project: |
| renovating their homes is how to pay for them. Many | | | | Talk to lenders about your options. |
| are on fixed incomes with few resources. Their | | | | Know that lenders are concerned about income, debts, |
| property may have increased in value, but they are | | | | credit history and property value. |
| cash-poor. | | | | -Consider a secured loan when you want to borrow |
| During this seminar, a flyer was distributed that | | | | more money, get a lower interest rate or reduce |
| provided a telephone number for the city and county | | | | taxes. |
| Elderly Affairs Division Rehabilitation Loan Program. | | | | -Refinance an existing loan if you have enough equity |
| Many cities have similar funds available as a means to | | | | and if the rates are two points lower now than when |
| assist individuals to stay in their own homes, rather | | | | you initially borrowed the money. |
| than move to more costly facilities. | | | | -Use a home equity line of credit that is secured by |
| I learnt that the loan program was available to a | | | | your home so you're your interest is tax deductible. |
| person or family requiring home modifications, based | | | | -Take out a home equity loan to get fixed rates and |
| on a health or safety need. The home loan program | | | | payments. |
| required that an application be submitted with | | | | -Consider a homeowner loan that is secured by your |
| information about the number of persons living in the | | | | property. Use a value added loan when the |
| household and their combined annual income. This | | | | improvement you make will have a substantial impact |
| information was then used to determine the interest | | | | on the market value of your home. |
| rate for the loan. For example, for combined incomes | | | | -Do your research before using contractor financing. |
| of less than $41,000 or so, the interest rate was 2 | | | | Good Luck |
| percent; for less than $52,000, 4 percent; and so on. | | | | Get more information on home loans and home |
| Another thing I learnt is that you can also have an | | | | remodelling by Lubowa.M.Planet. Visit Home Loans and |
| option, which is that of a reverse mortgage. A reverse | | | | mortagewebsite. |