Task force helps seniors transition from home to retirement living

“Last time” home sellers are finally getting the attention they deserve. These sellers who are selling their homes and transitioning into retirement communities, moving in with relatives or otherwise leaving the market will have an increasing effect on the housing market as our population ages.

So, the Mainstreet Organization of Realtors has created a Senior Services Task Force made up of Realtors, mortgage brokers, attorneys, insurance brokers, CPAs, senior community representatives and others who specialize in helping seniors make real estate-related decisions and changes. Realtors in the group are Senior Real Estate Specialists.

The state of Illinois offers the Senior Real Estate Specialist training for Realtors in order to teach agents how to advise seniors about their futures and where to direct them for answers on a variety of issues.

The Mainstreet senior services group meets monthly and shares their experiences and expertise on all aspects of the puzzle from reverse mortgages, to powers of attorney, to adapting homes for older residents, to choosing a senior community. They also regularly visit senior centers and other places seniors gather to share their knowledge.

Senior Real Estate Specialists have learned that most seniors expect a face-to-face meeting with prospective Realtors, rather than contact over the phone or by email, as many younger people prefer. They also expect a professional demeanor and more formal clothing from Realtors they are considering.

“You also need to take a more laid back approach when you are dealing with a senior citizen,” explained Mike Rickert of Rickert Realtors in Des Plaines. “And you need to quickly build trust.”

That is why he runs a property’s tax records before he ever visits the home, making sure that the senior is getting all of the senior discounts they deserve. If not, he comes armed with contact information to help the senior reclaim the three years of back-discounts they can still legally claim.

Rickert also does a market evaluation based on what other homes in the area have sold, an evaluation which he can later amend after walking the property and seeing all it has to offer.

“When I actually go to speak with a senior, I immediately tell them that they need to talk to two other Realtors before they choose someone to list their home,” he said. “This way they know that I am not going to pressure them to list their house that day. You can’t pressure older people and you have to take the time to listen to what they are saying. Maybe they are so emotionally attached to their home that they don’t want to sell at all. Then you can suggest accommodations like grab bars, the right kind of carpet and extra help so that they can stay in their home.

“When you are a Senior Real Estate Specialist, you have to cover all the bases and be willing to adjust to meet each senior’s needs. You are not just there to sell a home. You need to help everyone involved, including family members, decide what is best for this particular senior. You want to make sure that they are not being pressured to do what they don’t really want to do,” Rickert added.

Gentle questions about the person’s mental and physical states, so that the Realtor can understand the whole picture, usually follow, as well as questions about powers of attorney and who has the authority to sign papers. If they need an attorney to draw up appropriate papers, several are members of the Senior Services Task Force.

Once those important issues have been covered, Senior Real Estate Specialists need to explore the potential client’s attachment to their home. Emotions tend to play a very important role in seniors’ transactions since they may be leaving the home where they raised their family or lived for decades, considering it a “port in the storm” during bad economic and family times over the years.

“Some also worry about the pets or grown children who share the home with them, even though that home has become too much for them to handle,” Rickert explained.

A senior’s departure from a home often means giving up their independence and for some, the move has been precipitated by an injury or illness that carries its own emotional weight so Senior Real Estate Specialists are trained to be considerate of the seniors’ feelings.

When it comes to the subject of updates and repairs to the home, “many seniors have the attitude that the home was good enough for me to live in for 50 years or for my family to live in, so they don’t want to invest in updates,” Rickert explained.

“Then it is my job to carefully explain about the repairs and updates I see that need to be done to make the home marketable and the things that an appraiser would be looking at when considering whether to give the buyer a mortgage,” he continued. “I have even put together a brochure about this that I give to my clients.”

“Some suburbs require an inspection and that things in the home be brought up to code before a home is sold, so if their home is located in one of those communities, I tell them about that, too, and can recommend some handymen,” Rickert said.

“Unfortunately, as these repairs and updates mount, the senior gets less and less for their home. So, I also suggest FHA 203K loans to potential buyers of the property. These allow borrowers money to fix-up a property as part of the low-interest loan,” Rickert added.

He also cautions his clients against friendly neighbors who step forward and offer to purchase a senior’s property. Many times, the amount they offer is very low compared to open market prices and most seniors need the money from the sale of their home to cushion their retirement living.

“One client’s neighbor offered her $105,000 for a home that we were able to sell later for $289,000,” he recalled. “That money made a big difference in the quality of the rest of her life.”

On the other end of the transaction Senior Real Estate Specialists like Rickert also help their senior clients choose their next home — usually in a senior community. Rickert usually tries to suggest three different communities so that they have a choice and he often even meets them for community tours or drives them to the tours, if they need that assistance.

Joseph F. Vaccaro and his wife, Mary, moved from their home in Chicago’s Lincolnwood neighborhood to The Heritage senior community in Des Plaines with real estate advice from Rickert.

“I had worked for People’s Gas in a department where I dealt with many Realtors, so I was very familiar with the real estate business,” Vaccaro recalled. “Mike was great. We followed all of his suggestions during the process of selling our home and we knew that if we had had a problem, he would have come running. He was totally on our side when closing the deal.”

“In fact, we liked him so much that we still keep in touch, exchanging holiday cards,” he added.

Among the other senior specialists who are members of the Mainstreet Organization’s Senior Services Task Force is mortgage specialist Dennis Baier of Wintrust Mortgage in Rolling Meadows.

“I am a baby boomer myself and as I have gotten older I have found myself and others talking more and more about senior needs and issues so I decided to join Mainstreet’s Senior Services Task Force in order to provide information about reverse mortgages to seniors who want to remain in their homes and possibly be able to afford to have live-in help,” Baier explained.

The job of non-Realtors on the task force is to help the Realtors do their jobs more effectively and to act as additional resources for senior clients, according to Baier.

“Some of the other affiliates are elder law attorneys, as well as attorneys who specialize in wills and probate; others help with placement in senior living facilities; another affiliate stages homes to help them sell; and one even offers options for air quality control in seniors’ homes,” he said, “and we cover the suburbs, west of I-294 to Route 59 and from the Wisconsin line to Tinley Park.”

Baier feels that there is a great need for assistance of this type because “seniors get disconnected from information and life when they retire and get out of the normal flow of information.”

“The members of this task force can help provide them with the information, expertise and confidence they need to make these life transitions,” he explained.

Baier’s particular area of expertise is reverse mortgages. After 19 years in the mortgage business, he feels qualified to advise seniors about their options, depending on their unique situations.

“Reverse mortgages can be very good, depending upon the individual senior’s overall financial situation,” he said. “Bringing in care so that a senior can remain in his or her home can be very expensive and a reverse mortgage allow the home’s equity to be used for medical and other needs.”

Such a mortgage can also be used by younger seniors who want to buy a smaller house, either here or someplace warmer, according to Baier. They can take the profit from the sale of their current home and use it for a new home, but not have to make additional payments. Later they or their heirs can sell the home and pay off the rest of the mortgage balance or they can refinance into a conventional mortgage

“In this case, a reverse mortgage frees up money that would otherwise be set aside for mortgage payments,” he explained. “Closing costs and mortgage insurance premiums can even be rolled into some of these mortgages.”

It is important to note, however, that to qualify for this type of mortgage, everyone listed on the home’s title must be 62 or older and you must continue to accrue for and pay your property taxes. You must also maintain your homeowner’s insurance on the property and must go through a counseling session with someone from HUD.

“I go over each senior’s individual financial situation to see if they are a candidate for a reverse mortgage; go over the pros and cons of this type of mortgage with them; and then if they want to move forward, I put them in touch with a HUD counselor who will also evaluate their financial and mental situations (are they competent to make this kind of decision?), do the calculations and then will help them fill out the application,” Baier explained.

“With all of the government protections that are now in place for seniors, they should have confidence about speaking to mortgage lenders who specialize in helping seniors. There are lots of safeguards out there for them,” he added.

“Wintrust, for instance, has an arm that specifically underwrites and processes reverse mortgages,” Baier said, so these types of loans are becoming more mainstream.

For more information about The Mainstreet Organization’s Senior Services Task Force and a list of the group’s members, log onto tinyurl.com/MOReSRES.