For many Grandboomers, thoughts of retirement, and hopefully, "the good life" are moving to the minds forefront. You've paid, or almost paid, the mortgage on the homestead.
Much as you hate to leave this place that's been such a part of your life, it's too big, too expensive to maintain, or in a location that no longer suits your needs, just to name a few reasons to sell. Maybe you want to travel and need only a smaller place as a home base, or you want to live in a different climate, or simply move into a smaller home.
Today, there are new wrinkles on how to sell your present home. One of the most interesting, and a good deal for all, is to see if any of your children want to move into the house. The home of their childhood might just be a place they'd like to return to now that they can afford it.
Here are some things to consider:
* Offer the home to all the children. If more than one is interested, you'll have to work out a way to complete the transaction and not alienate the children who don't get the house.
* At the outset, establish that this is a business deal.
* Have the house appraised by an independent appraiser. Encourage your child to do the same. If there's a difference in the value, settle in the middle.
* Because this is a business deal, make sure your child can afford the home
. * Your child should finance the transaction through a lending institution. However, if you're confident that you'll get your money and it won't lead to a devastating rift in your relationship, you might want to hold the mortgage yourself. The interest would give you additional income.
* If you need all the money now, don't even consider holding the mortgage.
* Whichever road you take, consult a tax or financial advisor.
You also have to remember that once you "sell" the house to your child, that person is the owner, with full rights to change the look inside and out. Can you accept changes to what was your house?
The benefits include keeping the family homestead in the family rather than having strangers tracking though the home while it's for sale. And positives that are more tangible like no real estate agent commissions.
Speaking of real estate commissions, if you decide to put your home on the market, you may want to negotiate with the real estate agent about the commission rate. More and more because of the high price of homes, this fee is negotiable. In addition, there's a new type of agent who will sell your home based on an hourly fee for his or her time. On the sale of a $400,000 home at the traditional 6%, you can get a lot of hours before it eats up the $24,000 commission on that sale.
© 2012 Created by Myles Bristowe.
