Aging parents find a home through remodeling

Category: National Mortgage News Published: Thursday, 16 October 2014 Written by Admin

This column recently focused on the rising number of senior housing projects to satisfy the demand by the increasing number of seniors. Today we look at another rising trend to satisfy the housing needs of seniors.

Many homeowners are remodeling their homes to create in-law suites for aging parents, with features to make them accessible and safe while providing plenty of space and privacy, it was reported by the National Association of Realtors.

AARP senior policy adviser Rodney Harrell says demand for in-law suites is on the rise as baby boomers age. And with the cost of caregiving facilities and services soaring, it may be more affordable for parents to move in with their children, it was noted in the NAR report.

These suites often are located on the first floor to eliminate stairs and feature flush thresholds; large bedroom and living areas; showers with ramp entries, built-in benches, and grab bars; and wide doorways -- giving parents their own space but keeping them close enough to interact with their children and grandchildren.

Moss Building and Designs Jason Hampel says homeowners should plan for the long term when designing in-law suites, assuming they can accommodate other uses and will add resale value.

In-law suites generally are integrated into the home and are intended for older or disabled relatives. This means they are not considered separate or accessory dwelling units that require special permits and are difficult to build under strict zoning rules.

In some jurisdictions, in-law suites can have a bedroom, sitting area, bathroom and a couple of appliances, but adding a stove or full kitchen could require special permits.

Questions from readers

Question: Whats the difference between a mortgage prequalification and preapproval?

Answer: On the Consumer Financial Protection Bureaus website, the regulator gives its answer to the question, Whats the difference between being prequalified and preapproved for a mortgage?

Today, some banks have made the decision to not issue pre-approval letters due to the cumbersome regulatory environment, so they may call their letter a pre-qualification. Lenders licensed as mortgage brokers cant issue a pre-approval letter because they arent licensed to approve loans, it was reported by National Mortgage News.

Some lenders issue letters based on a simple conversation with the borrower and call them pre-approvals; some lenders have borrowers submit information though a website that churns pre-approval letters without any lender review. Some lenders issue letters only after a thorough investigative process.

Q: What factors are being considered in determining how much to increase g-fees?

A: The Federal Housing Finance Agency is now considering a proposed increase in fees charged by the GSEs (Fannie Mae and Freddie Mac) to provide guarantees on mortgage-backed securities. A new report from the Urban Institute suggests the agency faces a more difficult task than one might assume.

Breaking down information released by FHFA in a request for public input, the team at the Urban Institute determined there are three crucial assumptions the agency must make when calculating an appropriate number for g-fees, it was reported by DS News.

Factors being considered are whether or not to count future g-fee premiums as capital, what return on equity to assume, and what kind of capital buffer Fannie Mae and Freddie Mac need beyond what is required to cover expected losses in a stress scenario.

Q: Can poor credit result in higher insurance premiums?

A: Yes, a low credit score can be quite costly. Those with poor credit pay 91 percent more than people with excellent credit, while those with median credit pay 29 percent more, according to InsuranceQuotes.com, a part of Bankrate Insurance. Quadrant Information Service conducted the study in July for InsuranceQuotes.com

This is another example of why credit is such an important part of your financial life, said Laura Adams, a senior analyst with InsuranceQuotes.com in a press release. Maintaining a good credit history suggests that youre a less risky customer and can lead to several hundred dollars in annual homeowners insurance savings.

Q: Why do so many young adults still live with their parents?

A: Many reasons could be cited, but one factor was revealed in a recent survey. Experts have surveyed the young generation again and again as to why they are staying with their parents.

Now Fannie Mae has completed a survey of the parents they live with. As it turns out, more than half of them dont mind their children living at home.



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