The Cost of Downsizing to a Smaller House
Topic: Disability Housing
Author: HomEquity Bank - Contact: www.chip.ca
Published: 2014/09/24 - Updated: 2015/11/14
Contents: Summary - Introduction - Main Item - Related Topics
Synopsis: Article looks at the hidden financial costs of downsizing to a smaller home or condo for senior retirement.
Introduction
Seniors: ready to spend a minimum of $40,000? That's the average cost of downsizing to a smaller home...
Main Item
When it comes to retirement, many Canadians look to downsizing to a smaller home or condo to supplement income for their latter years.
What many fail to realize, however, is the average cost of downsizing is approximately $40,000. That's according to mortgage agent John Cavan, a 26-year industry expert with Mortgage Architects. The cost is an industry average based on the sale of a $400,000 home and includes real estate, legal and moving fees as well as land transfer taxes.
"Sometimes, all their money is tied up into their home, so they consider downsizing. What I tell my senior clients is that if they took half this amount, there's a good chance they could make modifications to their home and stay there. I tell them: you've worked for your home all your life, now your home can give back to you," he explains.
Most Canadian seniors want to remain in the family home as they age, confirms Jeff Spencer, HomEquity Bank VP National Sales, as there's a financial and emotional cost to downsizing. However, many haven't saved enough for retirement, so it makes sense to review the option of a reverse mortgage with an expert.
Mr. Cavan, who is located in Milton, Ontario, educates clients and provides options so they can make informed decisions. He also helps families have difficult conversations regarding money and inheritance. What he finds is that a reverse mortgage can be a very valid option for his senior citizen clients wishing to remain in their homes and maintain their independence. In fact, if Canadian-style reverse mortgages were available in Ireland, he says it would be a perfect solution for his mother "who has worked very, very hard.""Downsizing is not a 'wish' or a 'want' for most of the people who come into my office," Mr. Cavan notes. "They want to remain close to their children and grandchildren. And they lose their independence as soon as they leave their homes," he adds.
How the CHIP reverse mortgage works:
- Visit www.chip.ca or call 1.877.503.2447 to determine the amount of money available, which is based on the homeowners' age and the location and type of home as well as the home's current appraised value.
- Access money as a one-time lump sum, as monthly payments or both - it's tailored to individual needs.
- Up to 50% of the home's value can be accessed and the money is tax free. Unlike a traditional loan, no payments are necessary until it's time to move or sell the home.
HomEquity Bank is a Schedule 1 Canadian Bank offering the CHIP reverse mortgage solution www.chip.ca. It was founded 28 years ago as an annuity based solution addressing the financial needs of Canadians who want to access the equity of their top asset - their home.
Explore Related Topics
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2 - How Are People With Disabilities Doing in the New York City Housing Market? - Housing conditions for people with disabilities in New York State are deteriorating. The most common problem is lack of money.
3 - HUD Unveils $212 Million Funding Opportunity to Enhance Accessible Housing Choices for Individuals with Disabilities - Funding enables the creation and revitalization of accessible housing, assisting individuals with disabilities of very-low and extremely low incomes.
4 - FEMA Climate Change Home Buyout Program Not Sustainable - The Hazard Mitigation Grant Program has bought over 43,000 homes since 1989, usually after a presidential disaster declaration, to reduce flood insurance liability and turn properties into green space.
5 - DOJ Settlement with Bank of America to Resolve Claims of Disability Discrimination and Compensate Victims - Complaint alleges that the Bank of America refused to issue mortgages to individuals who are under guardianships.
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Cite This Page (APA): HomEquity Bank. (2014, September 24 - Last revised: 2015, November 14). The Cost of Downsizing to a Smaller House. Disabled World. Retrieved October 9, 2024 from www.disabled-world.com/disability/housing/downsizing.php
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