Now that there is a grandchild in the picture (our niece; this is not an announcement), MIL has talked about upsizing since she feels like their house is too small for kids and grandkids to visit all at once. So, I can see this mentality. (Fortunately MIL and FIL are good with money so we're not worried about them negatively impacting their kids.)
All of this is stuff I'm considering even now with a potential future remodel. I am already considering the implications of paying for a bump-out vs. adding a level. If we stay in a one-level home we can stay pretty much forever until we get to the point of assisted living or whatever. And we're only in our early 30s.
If by work out you mean work out at a loss, then yes.
I haven't noticed any of my senior clients having trouble getting a mortgage if they want one. So, the banks must find them to be a pretty safe risk or they wouldn't do the loans. I have also handled a lot of estate sales. Most of the time, older buyers are putting a lot down. When they pass, there is usually enough equity in the house to pay off the mortgage.
This was more geared towards the comments of people leveraging themselves to the hilt at retirement to build an expensive dream home. I know that requiring a hefty down payment is the norm, but I also know that there are still lenders that will allow little to no money down. That, IMO, is reckless (not on the pet of the borrower, on the part of the bank).
I guess I don't see the reasoning behind upsizing for the 1 or 2 visits a year.
I don't, either. I would think you could set aside a portion of the increased costs to put people up in a hotel and still come out ahead. I could see not downsizing for that reason and maintaining the status quo as long as possible (which is what my mom seems to be doing with her house), but I don't understand taking on more.
We are in a 2-bedroom rental apartment. I think we're going to want to have a baby before we can realistically buy a house or upgrade to a 3-bedroom rental. But our management company can get us a good deal on a hotel one mile away, so I think it makes more sense to stay where we are and set aside $1,000/year to get hotel rooms for visitors than to spend thousands and thousands we can't afford just so we can have a guest room for 12 nights a year.
I don't, either. I would think you could set aside a portion of the increased costs to put people up in a hotel and still come out ahead. I could see not downsizing for that reason and maintaining the status quo as long as possible (which is what my mom seems to be doing with her house), but I don't understand taking on more.
We are in a 2-bedroom rental apartment. I think we're going to want to have a baby before we can realistically buy a house or upgrade to a 3-bedroom rental. But our management company can get us a good deal on a hotel one mile away, so I think it makes more sense to stay where we are and set aside $1,000/year to get hotel rooms for visitors than to spend thousands and thousands we can't afford just so we can have a guest room for 12 nights a year.
We have a 3 bedroom house (master, guest hypothetical nursery office) and our logic is that if all the rooms are full we don't have to host people. There is a hotel 2 minutes away. We don't have to host people, they get their space, win all around.
This is also why we haven't been rushing to hang a door on our guest room. It helps when people want to "crash"; they usually change their mind.
We don't have a guest room either, and I like it that way.
This is when I fall to my knees in gratitude that my mom is the driving force keeping my parents financially fine for their retirement. She told me their financial picture for when she retires - they'll still be bringing in more per month in retirement than my H and I currently do working. She said they owe about $10k on their house, which she can pay off, she just doesn't know if that's the smartest move.
This is when I fall to my knees in gratitude that my mom is the driving force keeping my parents financially fine for their retirement. She told me their financial picture for when she retires - they'll still be bringing in more per month in retirement than my H and I currently do working. She said they owe about $10k on their house, which she can pay off, she just doesn't know if that's the smartest move.
My IL's on the other hand...I can't even think about what that's going to look like. My MIL is currently house shopping, and wants space and a pool. Who wants to maintain that shit when they get older???
Ditto with your first paragraph and my parents. They just retired in June and they are now making slightly more per year with their retirement and pensions than they made working full time and saving for retirement. So I guess that is good. I'm glad they have told me this b/c they just remodeled a Victorian house (5+ bedrooms, 3.5 bath) that is WAY bigger than the house we grew up in, but they still own the house we grew up in and a house next door (that they remodeled about 6 years ago). It's crazy that they have a lot of equity in houses and a lot of debt too. I just assume their mortgage is larger now than in the past, but they typically have had mortgages in the $400/month range b/c they bought both first houses early in the late 70's and houses were cheap for boomers then!
We have a 3 bedroom house (master, guest hypothetical nursery office) and our logic is that if all the rooms are full we don't have to host people. There is a hotel 2 minutes away. We don't have to host people, they get their space, win all around.
This is also why we haven't been rushing to hang a door on our guest room. It helps when people want to "crash"; they usually change their mind.
We don't have a guest room either, and I like it that way.
The number 1 reason I like having a guest room is that sometimes we have traveling bands stay with us. About a month ago, we had a four-piece stay with us. Two dudes on the guest bed, one on the air mattress, one on the couch. But I figure if there's a mini-taco in the picture, we wouldn't be offering up our digs anyway.
I haven't noticed any of my senior clients having trouble getting a mortgage if they want one. So, the banks must find them to be a pretty safe risk or they wouldn't do the loans. I have also handled a lot of estate sales. Most of the time, older buyers are putting a lot down. When they pass, there is usually enough equity in the house to pay off the mortgage.
This was more geared towards the comments of people leveraging themselves to the hilt at retirement to build an expensive dream home. I know that requiring a hefty down payment is the norm, but I also know that there are still lenders that will allow little to no money down. That, IMO, is reckless (not on the pet of the borrower, on the part of the bank).
Oh, got it. I guess if they are making the loans, then they must not find them to be too risky. Otherwise, they wouldn't do them. On the other hand, banks do have to make sure they don't violate fair housing laws. So, they wouldn't be able to discriminate against someone because of age. So, maybe they don't have as much choice as I would think. Hmmm. Now you have me wondering. I will ask my mortgage broker and report back.
We don't have a guest room either, and I like it that way.
The number 1 reason I like having a guest room is that sometimes we have traveling bands stay with us. About a month ago, we had a four-piece stay with us. Two dudes on the guest bed, one on the air mattress, one on the couch. But I figure if there's a mini-taco in the picture, we wouldn't be offering up our digs anyway.
Yeah I couldn't handle that many in my tiny house, but we also have a lab and 3 cats and I make it a point to casually mention how early the twins get up on their own. So that ensures that very few people even want to stay with us anyway. LOL!
Who in their right mind would underwrite a brand new mortgage for someone who is 65? Are these 30 fixed?
i want the name of the idiot that did the underwriting on my mother's 30 year fixed when she was nearly 62. she died (unexpectedly, but whatever) 3 MONTHS LATER.
now my sister and i have an underwater condo that we can't dump if we tried.
So you guys inherited this debt, right? You inherited the requirement to pay the condo off?
This is the #1 reason I'm glad my mom is not married to her fiance. He refinanced his house a year or two ago. They are in their mid-to-late 50s. I hope they refi'd for a 15 year note and I know the interest rate was MUCH lower, but if he dies, I want that debt going to his kids, not me.
And my step-mom isn't married to her partner either. This is also helpful so we don't inherit his overfinancing debt.
Having one set of grandparents who were very poor but born during the depression so they saw the long recovery time helped teach fiscal conservatism to my dad. He died in 2013 but his parents died in 2014 and 2015 with their funerals paid for and no debt and they lived below the poverty line most of their lives, with paying for their funerals as their biggest goal so their kids would not have to pay for it.
Having another set of grandparents as young adults during the depression helped even more on my mom's side (my grandma who was born relatively wealthy - long time Texas ranching family - was 18 when the stock market crashed. She had been modeling as an older teen and was expecting to go to a Texas University where there is a building named after her great-great uncle and live the debutante life her cousins knew. But her dad had invested heavily in the stock market and lost EVERYTHING. She had to be taken in by a family friend and become their maid. She is listed in the 1930 census as a laundry woman in their home. She and her husband saved up and paid cash for everything - and even though they fully owned a 65 acre ranch just outside Seguin, TX, she never purchased extravagantly - she would patch my brother's jeans and give them to me to wear because you used stuff until it FELL APART rather than pay for anything on lay away or spend your cash excessively.)
The fact that I'm 39, my husband is 47 and we just signed a new 30 year mortgage on our new house gives me incredible heart burn and I was surprised it was approved so easily. But we haven't sold our old home yet so we will pay down some of the mortgage with some of that equity and put a little aside for emergency funds as well so the home will be paid off when I'm 65 (with future bonuses targeted at paying it down even earlier).
OMG. This is going to be TERRIBLE when my ILs die. My MIL has collected so.much.stuff. They have a 3-bedroom house for the two of them, and there is just stuff EVERYWHERE. Because MIL has some fairly significant health problems, I suspect she will die before FIL despite being 5 years younger. I imagine FIL will just leave everything in the house as is, and then when he dies, we will have to deal with everything. H is an only child and a sentimental bastard. He will want to keep everything. I am going to be tempted to "accidentally" knock a candle over near something flammable.
#stonecoldbitch
Fortunately my H is not sentimental so we have purged nearly all of my MIL's ugly stuff.
But my FIL also has an insane amount of junk. And he is one of those paranoid gun nuts who isn't so great with safety, so he's got about 200 guns (no that's not an exaggeration) scattered all over the house, tucked away in boxes and cushions of old furniture. I don't even know how one begins going through stuff in that scenario.
I'm getting you Kevlar and a metal detector for Christmas.
i want the name of the idiot that did the underwriting on my mother's 30 year fixed when she was nearly 62. she died (unexpectedly, but whatever) 3 MONTHS LATER.
now my sister and i have an underwater condo that we can't dump if we tried.
So you guys inherited this debt, right? You inherited the requirement to pay the condo off?
yup. she died in 2006 and we're just now able to refi. it's basically going to be rental property to my sister's MIL so it's not a total mess.
We bought our home (a 1000 sq ft bungalow with fully finished basement, so about 1800 sq ft of living space, plus a huge double garage and storage shed) from boomers moving to the new burbs to live in their dream retirement house that was much bigger.
It's really strange. I figure we'll pay this off and hang tight until we can't do yard work and stairs any more.
Post by decemberwedding07 on Sept 8, 2015 11:26:44 GMT -5
My parents took out a 30 year mortgage when they were 57 and 60 years old. Why would someone give a 30 year loan to someone that old? They will never be able to pay that off! My mom doesn't work (and hasn't in over 35 years) and my dad plans to work until he dies. What happens if he can't work? What happens if he dies first? And why am I the one asking these questions, and not their bank or themselves?
Post by pantsparty on Sept 8, 2015 11:28:41 GMT -5
My dad is about to make his last mortgage payment. He retired 2 years ago. If they move out of their house, they'll be paying cash for a new house.
I am very thankful we don't have to worry about my parents financially. My dad knows more than a few people who have not only significant mortgage debt, second mortgages, etc., but a lot of debt in general for retirement age. The thought of that has me hyperventilating.
Then again, I've never been a "dream house" person. I'd rather retire, downsize, and spend our money traveling than be house poor.
Well, my dad turned 76 this year and my mom died 8 years ago, which means he bought his current house about 5 or 6 years ago...so someone gave him a mortgage at over 70. Not suggesting for one second that this was a good idea on their part, but it happened.
My parents took out a 30 year mortgage when they were 57 and 60 years old. Why would someone give a 30 year loan to someone that old? They will never be able to pay that off! My mom doesn't work (and hasn't in over 35 years) and my dad plans to work until he dies. What happens if he can't work? What happens if he dies first? And why am I the one asking these questions, and not their bank or themselves?
My mom hopes to become a first-time homeowner (condo) in the next year or two. She's 52 years old now and I don't disapprove of her doing this because the rent is too damn high (buying would be cheaper) and I am concerned about her ability to pay rent during retirement. She's been working like a fiend to save up as much for a down payment as she can so that her mortgage is minimal. But I honestly didn't think she could qualify for a mortgage so I did some researching and essentially, you can't discriminate on someone applying for a mortgage based on their age.
Say what? Why??? What is the point of this? I thought it was typical to look forward to the empty-nest years and stay where you are or downsize, not build a gigantic new home that you'll be too old to maintain the way it needs to be maintained.
Geez, this boomer vision of retirement gives me hives.
There's a commercial for some real estate site that has a woman with a small child helping her mom find a new house. She ends up with a huge house on a lake and everyone is so excited. Every time I see it, I wonder how excited everyone will be when the mom can't handle the lake house anymore and they have to drive up every weekend to help her instead of swim.
People buy into this. This was my Dad's fantasy when he bought a house on a lake in Montana. We were going to bring the grandkids out to fish and make memories all summer long and it was going to be so fun! It was a 10 -22 hour drive depending on where on the west coast we were living. We spent one summer vacation painting the desk, another attempting to repair the dock, another crawling under the house trying to find a leak. We are not handy people. It was not fun. Thankfully he sold that place a bought a condo about a hour away in the scenic Willamette river valley.
We have a 3 bedroom house (master, guest hypothetical nursery office) and our logic is that if all the rooms are full we don't have to host people. There is a hotel 2 minutes away. We don't have to host people, they get their space, win all around.
This is also why we haven't been rushing to hang a door on our guest room. It helps when people want to "crash"; they usually change their mind.
We don't have a guest room either, and I like it that way.
Our first room has a futon. We haven't replaced it purposely.
Post by Scout'sHonor on Sept 8, 2015 11:53:39 GMT -5
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
My parents bought a bigger house in retirement but they went from hcol to m/lcol and their old house was paid off, so they didn't end up with a mortgage. We have a whole separate issue with whether or not they'll be able to keep up with the maintenance in the long run, but for now they're doing ok. They wanted a big enough house to host kids and grandkids, and I have to say it is nice that they can handle 6 adults and now 4.5 kids at the holidays.
my mom & stepdad did something similar - when the market crashed, they bought their retirement house in WA state and rented it out for a few years before they formally retired. The 'new' house is 2x as big as the old house and about 1/2 the price !
Post by anastasia517 on Sept 8, 2015 12:10:53 GMT -5
My parents were born at the tail end of the Baby Boom and had their house paid off just before I finished high school, when they were in their late 40s. A couple years later it was sold during their divorce. So even though they were smart and did things "right" they are now both renting and in a much worse financial position. It worries me because my mother makes very little and was the smart one with money and while my dad makes a decent amount he blows it all, helps his mother out, etc.
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
Wait, I thought you didn't have to inherit parents' debt, is it if the estate can't pay it off? I'm sweating bullets now, b/c my parents are up to their eyeballs in mortgages, seconds, home equity loans, etc.
My understanding is, as long as you haven't co-signed any of the loans, you aren't responsible for any of the debt.
My parents are young boomers with a paid off house, which is great except my dad wants to move out of the county they're in and closer to his work with some land. He's still got about 8 years left to work, more if he moves into administration (he's LEO), and already gets a pension from his first retirement so they should be good on a 15-year mortgage. It will take years to clean out their hoarded house and get it ready to sell, though, and I cant do it so I hope they have a plan. I'd like for them to downsize so I would have an excuse to stay in a hotel with DH and four kids instead of feeling obligated to stay with them for holidays and such.
For me personally? I'll be taking a play from my grandparents' playbook and getting a modest place to call home base for holidays, and buying a nice used motorhome so we can hit the road. I didn't get enough time to travel before the kids came along so we'll be taking advantage of being empty nesters.