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About three years ago, my family and I decided to take advantage of Toronto’s real estate upswing. We opted to sell our townhome while prices were skyrocketing ending up with a very decent profit. In fact, our profit was so good that it allowed us to pay cash for a large, four-bedroom character home in Winnipeg. Yes, we had decided to relocate to another city, leaving our friends and family behind, setting out for a new life for our family. And the best part? We were mortgage-free!

Coming to the house itself, the property seemed almost double in size with a sprawling house in the center! If one could speculate how much such a house would have fetched in the Toronto real estate market, probably $300,000. And if it was renovated and placed in a popular location, the sale would have been close to $500,000. We had to shell out just $65,000 for this house as it needed some repairs. But with the estate prices going up by 20% year after year, should we decide to sell it, our profits are going to multiply manifold! Yes, a few repairs had to be carried out; some are still pending. Our plans include installing a brand new hardwood flooring for the entire living area. Whatever it may be, these are just minor problems, considering the size of the house and how less we paid for it!

If one should peruse the listings of houses in Toronto, one would get a shock to discover that the prices of independent homes in the city are out of reach of the common man. They can only settle for condominiums or town homes. A big house sells for nothing less than $250,000. The condition of the house does not matter–the price is fixed. So most people cannot afford to buy houses in Toronto. They cannot opt for good neighborhoods or places with plenty of amenities or good conditions.

All the more reason for joy, when I learnt about this! The relocation has come at the right time! Winnipeg does not have a gridlock through which to battle for office goers. Since situations are better, people do not succumb to road rage. People can still afford to buy houses, as they are below $100,000. Even the neighborhoods offer a choice. Home owners can benefit from the many incentives offered by Manitoba Hydro. A person who buys a fixer-upper can install highly efficient furnaces plus new windows. The interest rates are reasonable on loans. There are also town homes and condominiums for sale. Additionally, compared to Toronto, the maintenance fees are but a fraction over here.

Winnipeg truly has something for everyone. Our housing prices blow Toronto real estate costs out of the water… and that’s just the beginning.

We have now made Winnipeg our home, probably for good. Yes, we miss our friends and family, but we still find ways to keep in touch and see each other on a regular basis. Our family is much happier with our slower pace, the kids love having so much space to run around, and we feel like we’ve made a smart decision for the long run.

Many people end up working very hard in their lifetimes to earn enough to purchase a home and basically just keep living. Once you get to the ripe old age in which you can no longer work or when you retire, you might not have much money left over to truly relax. Many people look to getting equity release as means to remedy this, and better yet, it is a great way to make use of your home.

Using the value of your home is made possible by an equity release. The great thing about it is that you can remain living in the home until you die and not worry about repaying anything towards the loan. A borrower has the ability to take the value of the equity of the home in the equity release loan. Repayment is made by giving the home to the lender of the equity release upon the passing of the borrower.

With this large sum of money now in the hands of the borrower, many of the people that use this loan option travel the world or head on an extended vacation to relax. Once they finish their adventures, they can return to their homes to finish their long lived run on this earth. This can deeply calm the soul.

Many of the borrowers use their equity release as a source of income to supplement what they get in retirement. Many times this money can be taken as a large lump sum or a monthly income source like a job might provide.

If you do have beneficiaries, it may be a good idea to start a trust fund of sorts for a young scholar in your life. That way, when they are old enough, they can look forward to going to any school they please as well as not having to worry about paying off any loans related to schooling. Your beneficiaries would really enjoy having money over estate as estates are very hard to share.

The least you can do with an equity release is put it in a high interest savings account for your beneficiaries to inherit once you pass away. That way the value of the money goes up while you are happily waiting for your time to come.

Closing Comments

Equity releases are a type of loan that can really benefit an older person. They can even use it towards bettering the future for their beneficiaries.

Mortgages are usually taken out in the event that a borrower needs a large amount of cash, but does not have it available. A mortgage is when your home is used for collateral, and in the event that you cannot pay you have two options. A foreclosure is the least desirable option, they take your home and sell it to cover your loan expenses. It is typically tragic for most, and you pretty much lose everything. Loan modification is the better option, where if you have hardships then you can get your loan modified and avoid a foreclosure.

Since you are bound to your loan by a contract, and your home is the collateral, it is very important that you have the means to pay back the loan within the set time. Failing to comply will most definitely result in a foreclosure. Some banks may be nice about it, but many are not. You get to keep all of the stuff inside your home, but your house will definitely be sold for the amount remaining, or higher, than the loan.

If your income has suddenly changed due to a hardship then you are eligible for a loan modification. It is crucial that you apply for a loan modification before you are too far behind on your mortgage, failing to do so puts your home at greater risk for foreclosure.

Being laid off, medical problems, a death in the family, and many other reasons are all types of hardships that are recognized by many banks. Each bank will have a different opinion, but they are generally the same.

Loan modification can mean many things, either a complete refinance, or just modifications of small parts of the loan. The time can be extended, and the interest can be changed. A few other things can also take place, but those are solely at the discretion of the lender.

Foreclosures do happen, and don’t think that you are invincible. Load modifications can help you avoid a foreclosure, as long as you modify your loan in a timely manner. These are great for hardships, and prevent you from losing your home and killing your credit.

Closing Comments

Avoiding a foreclosure by getting a loan modification is a good step to take in the event that you are faced with hardships that change the course of your income. Loan modifications can mean extending the loan, lowering interest, or making special arrangements to have the interest and payments deferred.