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What to Do When Downsizing For Retirement

Retirement is an exciting time for seniors. When preparing for retirement, seniors consider downsizing and selling assets. Buying a smaller home controls how much they pay each month. It also helps seniors live more comfortably and reduces their utility costs. Reviewing opportunities for downsizing helps seniors plan ahead. 

Get a Preapproval for a Mortgage

A preapproval for the mortgage shows the borrower what they can get from a lender when buying a home. When retiring, many seniors choose to sell their homes and buy smaller properties. The strategy is more affordable, and the family doesn’t have to visit a retirement community. The lender reviews the borrower’s income and debts to calculate the income-to-debt ratio and find out what the borrower can afford according to their monthly obligations. 

Prepare Your Home to Sell

Seniors prepare their homes by removing their belongings and staging the property. Real estate agents recommend staging to give the potential buyer a view of what the property would look like if they lived there. Painting the rooms in neutral tones improves the chances of a faster sale and eliminates bright colors that are hard to cover. Placing minimal furnishings in the home helps to show how much space is inside each living space. Decluttering and depersonalizing the home makes it more appealing to buyers. Seniors can learn more about strategies for downsizing from Dustin Dimisa now. 

Sell Assets You Don’t Need

Selling assets that the seniors don’t need gives them more cash on hand. Antiques, artwork, and other valuables offer more cash value, and seniors can sell them a variety of ways. Placing the funds in savings accounts helps them generate more interest on the money. Downsizing gives the seniors a chance to review their items and sell anything they don’t need. Generating more money gives them a chance to live more comfortably in later years

Start Your Home Search 

A real estate agent helps the buyer find a home that meets their needs. Downsizing means that the seniors want a property that accommodates them and guests. A two-bedroom property offers enough room for the seniors and gives them a guest room for times when family members come to visit. Staying within their budget helps the seniors avoid economic hardships. 

Start the New Mortgage Contract

The lender provides a mortgage according to the borrower’s credit scores and income-to-debt ratio. The interest rates depend on the borrower’s qualifications. Lenders provide a mortgage contract once they approve the borrower. It defines the monthly payments and outlines all insurance requirements. Mortgages such as FHA loans require mortgage insurance until the borrower pays at least 20% of their mortgage. Buyers need homeowner’s insurance policies for the property, too. 

Retirement is a great time for enjoying the little things in life and relaxing. A careful plan helps seniors enjoy retirement more and avoid economic hardships that make life difficult. Downsizing helps seniors sell their current home and purchase a quainter property. Seniors can find out more about downsizing and getting a new mortgage from a local lender now.