December 20, 2006 at 12:12 PM #8096PeaceParticipant
O.K. here is a legitimate reason to live on equity. There are two old ladies, in their mid-eighties, who own their Olde Carlsbad home. It’s a crappy old house that they have not maintained. It is now to the point that they are being scrutinized by the health dept. The place really is a mess, with stuff piled up in all the rooms almost to the ceiling, the heater hasn’t worked for years and who knows what else. But they would not even consider moving out.
The only hiers are distant relatives that live in other states and don’t help them at all. The place could easily be appraised for $500K. They are not related but the title is held jointly.
Option #1 – get a reverse mortgage? I don’t know much about these but I’m worried about the legal issues when one of them dies and the heirs come out of the woodwork. Plus what happens when one or both end up in a old folks home? More expensive than a equity loan?
Option #2 – an equity loan? The house is long paid off and this seems like a cleaner option as to just getting the money out and fixing up the house and living on the rest. Plus I think it would be easier to deal with the legalities such as the surviving one would get all the money until both are deceased. And probably cheaper that a reverse mortgage?
Are there other options?
These two ladies have done so much for others all their lives and now that they are old, they are all aloneDecember 20, 2006 at 2:23 PM #42159surveyorParticipant
Not a terrific option, but if they had extra space and depending on the configuration of the house, they could rent out space for their house to a tenant who could clean up the property and do minor repairs. craigslist seems to have a few of those people advertising for such an arrangement.
Certainly they should be choosy and make sure they do a check on any person who would live with them.
But like I said, not a terrific option.December 20, 2006 at 3:20 PM #42165sdcellarParticipant
Probably safer to just suck the money out of their house and pay for things that way. I would definitely recommend they plan out their remaining future as best they can, as I’m not sure they’d be able to do it more than once.
I’d run the numbers on both of the options that you listed and after making sure each will cover their expected costs for their remaining years, just pick the one that is most cost effective.
- You must be logged in to reply to this topic.