Use a Realtor to Stay in Your Home

Dear Pat,
I’ve lived in my house for 38 years, and I’d like to stay here for as long as I’m able. I’m 72 years old, in good health, and my family is nearby in the neighborhood. I have no mortgage to worry about, but taxes and heat bills are eating up my Social Security income. I know you offer house appraisals for free, and I’d like to know the value of my house so I could look into a “reverse mortgage.” Can you do this for me, or are your appraisals just for selling?
---Homebody

Dear Homebody,

I offer a CMA (Competitive Market Analysis) to anybody who wants it, for whatever reason.  And I think you have a terrific reason: if you know your home’s current value you can make better decisions about your future.  When I’m first in the home I note the age of roof, gutters, mechanical systems and appliances that may need to be replaced as the years go by, and current conditions that may need attention to satisfy a bank appraiser (and to increase sale value, when the time comes).  Then I’ll provide “comps” (listing information on comparable homes to yours) which have sold nearby within the past year.  It’s likely I will have listed several of these homes myself, or been inside them—so I can usually make a clear and easy comparison to determine your home’s value.

I’m glad to hear you’re already aware of reverse mortgages, Homebody.  They were invented for people in just your circumstances.  And many people are starting to consider them as a valuable component of a sophisticated retirement plan, which might include a company pension, stock holdings and real estate, as well as social security.  For the uninitiated, a “reverse” mortgage pays you a monthly income for as long as you own the home, or a lump sum payment, or a combination (you may need some cash to pay off any existing mortgage—a requirement—or to make a major repair).  The amount of money you can receive is based on your home’s value, current interest rates, and your age—the older you are, the more money you can get.
   
You’ll still own your home and pay your own taxes and insurance.  Details and qualifications of these mortgages are too complex to discuss here, but I recommend the AARP website www.AARP.com and their excellent booklet entitled “Home Made Money.”  The website also lets you access a reverse mortgage calculator to find out how much you could receive if you were to take out a mortgage today: for instance, if you’re 72 years old living in a house valued at $225,000, you could obtain $133,048 in a lump sum, or $845 monthly until you sell your home.

It seems like a simple step to help keep many older people in their homes, if they choose to do so.  With a CMA I can provide you with at least some of the information you need to make the decision.  And for those of you who have already decided to sell, I urge you to read my article “Flip Off the Flippers” at www.riverrealty.net.  Please, do not let these people through your door.  Get a CMA from a legitimate, recommended Realtor to determine the true value of your home.