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No one likes the idea of sending their parent away to a nursing home to be surrounded by strangers all day. But is there anything else that can be done? Maybe you want to have them live with you in a spare bedroom. But what about the cost of upgrading your home to meet their needs and disabilities? Some of the changes don’t come cheap! So if you haven’t saved up, what’s a caring child of aging parents to do?
One option you could explore is refinancing your mortgage to finance home improvements. A cash-out refinance would allow you to get a great deal of money for renovations to provide the best home environment for an aging loved one.
Cashout Refinance for Home Improvements
How easy is your home to navigate for an elderly person? Are there steps at the entrance? Are the railings easy to grasp? Can your entryways become slippery when wet?
If you want to upgrade your home so an older parent can live with you, consider these three important upgrades: mobility, dexterity, and hygiene.
Mobility. It’s important that steps become ramps, handrails are placed in key areas (like bathrooms), and things your parent needs the most are easily accessible. For example, it’s a good idea to have their bedroom close to a bathroom they can use. Hallways and doorways need to have proper and current lighting so they can see obstacles in their way. Stairways can be upgraded to have chair lifts to reduce the risk of falls.
Dexterity. This might seem trivial, but as we age, our hands aren’t what they used to be. Does the oven get stuck, or is the freezer hard to pull open? Does the coffee maker need to be upgraded to decrease the amount of steps your parent needs to make if they want a cup? Upgrading cabinets with more lazy susans or putting more pantry items at eye-level can increase their comfort.
Hygiene. Bathrooms can be a potential disaster when it comes to the elderly and the potential for falls. Including non-slip mats in and around a bathtub or shower, hand rails by the toilet, and curbed or walk-in/sitting tubs can reduce that risk. Keep in mind, removing your existing tub and purchasing a more elderly-friendly tub can be expensive.
Some of these renovations can add up to thousands of dollars or more, depending on how many changes your home needs. But who can put a price tag on keeping a family member at home, rather than at a care center? With that in mind, here are a couple of options:
Cash-out refinance. You refinance your home for more than it’s worth, and the money you’ve put into the original mortgage is available to use as cash. This is a more advantageous option than a second mortgage, because you still only pay one loan and it often comes with a lower rate than a second mortgage.
Cashout Refinance Alternatives
Alternatives to doing a cashout refinance may be a Home Improvement loan or a Reverse Mortgage. These are unique loan options that can be used to finance the costs of home renovations.
HomeStyle Renovation Loans
Our HomeStyle Renovation Home improvement loan may be a great fit to allow you to finance the costs of home improvements into your mortgage. This program is a conventional home loan that is different from standard mortgages because it uses the future improved value. The appraiser will prepare your home appraisal valuation based on similar homes that have sold with the amenities and improvements that you are planning. You can still avoid PMI if your loan-to-value is under 80% although this loan option allows up to 95% financing for primary residences.
Reverse Mortgage for Home Improvements
A reverse mortgage loan may be another great solution for the elderly to improve their home’s safety and accessibility. A reverse mortgage is a loan type that allows homeowners to access the equity in their home without having to make monthly principal and interest mortgage payments. At the closing they may be able to receive a lump some in proceeds which can be used to pay for home improvements.
If you are serious about upgrading your home, contact us at Riverbank Finance (800-555-2098) so we can help you find the best way to afford the renovations you need.