Your new house was supposed to be your retirement palace. It wasn’t cheap, but living in paradise costs money—maybe more than you actually have—but you can’t bear the thought of selling until you’ve exhausted all of your options. Is there any way to lower the monthly payments or to bring your interest rate down?

Differences Between Refinancing and Mortgage Modification

The main difference between these two financing options is whether you wish to keep your existing loan under new terms (mortgage modification), or get a completely new mortgage with new terms, interests rates, and payments (refinancing). Here are a few pros and cons of each mortgage option:

Mortgage Modification

In cases where a homeowner is unable to afford his mortgage payments, the mortgage provider may offer a lower rate on the loan, called mortgage modification. The most common benefits are:

• You are allowed to keep your existing loan.
• The process is cheaper than refinancing.
• Mortgage modification helps bring down monthly payments.
• It will reduce interest rates.
• You can avoid foreclosure.

While modification may allow you to pay less money per month, it often means extending the term of the loan or paying additional fees. In addition, some people are so grateful for the option of modification that they accept the first offer on a new rate without negotiation, losing them hundreds of thousands of dollars over the life of the loan.

Refinancing

Refinancing involves paying off your existing loan with a new mortgage. Most people choose to refinance a home if they cannot reduce their current rate, or if they want to switch from an adjustable rate to a fixed rate mortgage. Some homeowners are able to borrow an additional amount when refinancing by using the equity they have built up in their homes. Benefits of refinancing include:

• Modifying the length of loan repayment
• Reducing your interest rate
• Lowering monthly payments
• Getting cash in hand to pay other costs or debt
• Consolidating multiple mortgages into a single loan

While lenders may offer these options for reducing payments, they often come with fees and penalties. Your existing lender may charge you a penalty for paying off your mortgage early, you will have to pay closing costs when refinancing—and after all the paperwork is signed, you may find that you are ultimately paying more in interest than you were before.

Before you agree to any terms, it is vital that you seek the advice of an experienced Collier County real estate attorney. At Blackwell, Vishio & Fisher, PLLC, we can look over your offers to determine whether you should work with a bank or mortgage company, how you can save the most money (both short and long-term), and give you the full financial picture of your housing commitment. Click the contact link on this page to find out how we can help protect your future.

As investment options grow, many retirees are choosing to keep their money at home—or at least, in their dream homes. One of the most popular real estate investment trends among affluent Florida residents is buying or building “legacy” properties: large-scale houses that are meant to be passed down to their children and grandchildren.

One couple, Bob and Carol Rogers of Longboat Key, Florida, recently built a 6,800-square-foot mountain home in North Carolina. It’s a retirement haven where they can host their growing family, and eventually, pass it on to their kids.

Mr. Rogers, 58, sold his commercial-contracting firm in order to purchase the home in 2008. The original cost of the 12-acre lot and house was $5 million, with an additional $1.2 million invested in improvements to the landscape.

“Twenty, thirty years from now, our kids can cherish it with all their kids,” he said.

Location plays a large role in determining the value of the home, as resort-style estates in areas with thriving tourist trades are more likely to increase in value. Estates such as these are increasingly popular with families who enjoy taking vacations together, but live in various states throughout the year. The home may be used as a holiday gathering place for widespread relatives, or used as a rental property when not in use by the owners, generating some of the income lost at the initial investment.

Legacy homes are typically designed to include multiple amenities that will appeal to a wide range of age groups. Architects have designed whole communities with legacy estates in mind, making the properties more like a resort than a family home. Houses may have several master bedrooms, or separate cottages or apartments adjacent to the main property.

Interiors may come equipped with lavish home theaters, expensive sound systems, or a projection television for families to enjoy movies and video games. Properties that are too far from the ocean may add the benefit of a swimming pool big enough for laps, a nearby hot tub, or a smaller splash pool for children. Large grassy areas may be modified into basketball or volleyball courts or shooting ranges, while farm or ranch estates are adapted to host horses, goats, cows, and other animals.

Seaside properties offer many opportunities for seniors to make a home their own. Owners may install boat houses, private docks, or even invest in their own private beaches.

Of course, once these properties have been established, owners must make steps to protect them. The Rogers’ home, for example, has been placed in a family trust that names the couple’s three children (as well as their spouses and children) as beneficiaries.

To find out more about protecting your assets in retirement and beyond, contact Florida estate planning attorney Ric Blackwell today.