Retiring With a Mortgage? 5 Strategies to Make It Work

Are you starting to seriously plan for retirement within the next decade or so? As you crunch the numbers, one big factor in most retirement
planning is the home mortgage. Although many people want to enter into retirement without a mortgage, this isn't always possible. So, if you have to carry a mortgage as a retiree, how can you approach it for success? Here are five strategies anyone can try.

1. Extend the Terms for Lower Payments

For most retirees, the main motivation to get rid of a mortgage is to reduce monthly obligations. This increases financial and housing security as
they shift to a fixed or limited income stream. But you can accomplish this as well by reducing that monthly payment to a minimum amount that's easily doable.

You have several choices to make this happen. The easiest may be to refinance your existing loan into one with much lower interest rates, no
mortgage insurance, and fewer fees. Or you could refinance what you still owe but extend the terms for several - or many - more years.

2. Shorten the Terms and Pay Your Mortgage Off Early

Just because you have a mortgage when you retire doesn't mean you will have it forever. The early years of retirement are the most financially
flexible years for many people. You can often work part-time, do consulting for your old employer, or start a side gig for extra income. Use this
time to pay off that mortgage while you feel good and have more options. The extra effort may also help you transition, as it keeps your mind and body active.

So, if you have a current mortgage or need to refinance to a loan that will carry over into retirement, don't let this deter you from retiring. Keep
the length of the loan limited so you can take advantage of this transitional retirement period without burdening your later retirement years.

3. Downsize for Lower Payments
Many retirees plan to downsize their living arrangements. But downsizing doesn't automatically mean limiting yourself to a home you can pay for outright.

Armed with a chunk of money from your prior home sale and a more minimal lifestyle, you can find a good compromise between cost and
comfort. Use the combination of your down payment and home size to find a low mortgage that you can easily live with on retirement income.

4. Replace Bad Mortgages With Good Ones

Having a mortgage may not be the real problem for you. What if it's the mortgage terms themselves? A mortgage with high interest rates, balloon payments, adjustable rates, or private mortgage insurance can all cost much more than your loan needs to. These extras may make the mortgage unsustainable. So, rather than focus on getting rid of a mortgage entirely, focus on ridding yourself of onerous terms.

5. Use Your Mortgage to Pay Off Debt

Good mortgage loans can serve as a beneficial type of debt. With a low rate and fixed payments, they are less risky than many other debts,
including student loans, credit cards, payday loans, and even personal or vehicle loans. Consider whether these other expenses are what's really
holding you back from retirement. If so, use your mortgage to get rid of these potentially damaging credit sources.

You might, for instance, refinance the mortgage and use the monthly savings to pay off debt or take cash from your refinance. Or put a low-cost
mortgage on autopilot and focus instead on getting rid of riskier debts before retirement.

Want to know more about mortgage options as you head into retirement? Would you like to find out if you can get better terms? Or how much
you might be able to take out in refinancing? No matter what questions you have, the best place to start finding answers is Cornerstone
Residential Mortgage. Call today to speak with a mortgage professional.