Deciding What To Do With Your Home Following The Death Of Your Spouse
The devastating effects of widowhood permeate every aspect of the surviving spouse's life, and the effects on finances can be some of the most difficult to navigate. To begin with, it's all about survival--protecting income and paying bills. A little later, when the spouse is ready to make some long-term decisions, what to do with the house is among the most important, and in many cases, the best choice isn't obvious. Looking at the big picture can help you determine the right course of action.
Maintenance and Upkeep
Houses need regular maintenance inside and out, and if you've not been your home's primary caretaker, the amount of time and energy that goes into upkeep can take you by surprise. Consider outdoor tasks such as mowing the lawn, weeding gardens and hardscaped areas where weeds pop up, cleaning gutters and siding, and staining or painting, if applicable.
Simplifying the outdoor maintenance routine can make the work more manageable. Removing or reducing gardens, allowing a portion of a large yard to grow naturally, and having gutter shields installed are just a few ideas for reducing the work it takes to keep up your cub appeal and make staying in your home more manageable.
For inside, consider purchasing a home warranty to make repairs more affordable. What's included depends on the level of coverage you purchase, but the warranty typically limits service-call fees and pays to repair or replace major appliances and components of such systems as heating and cooling, plumbing and electrical, for a cost of a few hundred dollars per year. Exclusions are just as important as inclusions, so examine the policy carefully before you buy.
Whether your home is an asset or a liability depends on how much you owe on the mortgage. If the house is paid off and your expenses consist solely of taxes, insurance, and perhaps homeowner's association fees, staying put might make financial sense. However, it's also possible that you'll get more mileage out of your equity if you sell your home, purchase a smaller, less-expensive one, and invest the remaining proceeds from the sale.
If you have a lot of equity in your house but your income is limited, a reverse mortgage can keep you in your home and provide income to help cover other expenses. You don't have to repay a reverse mortgage for as long as you live in your home.
Another option is to sell your existing home and get a new loan to purchase one that's less expensive, easier to maintain, or located in a more desirable area. If you're a surviving military spouses, determine whether you qualify for a Veterans Administration guaranteed loan. Such loans have competitive rates, liberal credit and income requirements, and they don't require that you make a down payment. Other government-backed loans include those insured by the Federal Housing Administration and those guaranteed by U.S. Department of Agriculture.
Even if you're not going to sell your home, you can use some of these loan types to borrow against your home to pay for needed repairs or to improve its energy efficiency.
Being close to family and friends helps to ensure an enjoyable social life as well as a strong support system. If you're geographically isolated from the people closest to you, a move could open up a whole new world. Giving up your home and moving in with family members may also be an option, but it comes at the expense of the right to rule your own roost. Only you know what the perfect balance is between support and companionship and your independence.
Seek Professional Advice
Don't be afraid to seek out professional advice. Your local bar association can help you schedule a free or low-cost legal consultation. You can also contact a U.S. Dept. of Housing and Urban Development housing counselor for advice about mortgage loans. You don't have to make this decision alone.
For VA loans, contact a company such as Texas Veterans Home Loans.