Affordable Housing Options for NJ Seniors
December 10, 2018 Leave a comment
With the first wave of baby boomers turning 65 in 2011, the number of senior citizens in the United States is increasing. According to the US census, by 2030 the number of people 65+ will reach nearly 71.5 million. Most seniors live on fixed incomes and sometimes retirement savings or programs like Social Security can’t support their housing expenses. Because many of these senior citizens will need affordable housing options, the U.S. Department of Housing and Urban Development (HUD) has been increasing their initiatives to help seniors manage their cost of living in retirement.
Reverse mortgages are an increasingly popular option for seniors who still have equity in their current home and are looking to supplement their retirement income. If you are 62+ and have paid off your mortgage or paid off a significant amount of the loan, you may be eligible for a reverse mortgage. Under a reverse mortgage, instead of making monthly payments to the lender, the lender actually makes payments to the borrower. The borrower must still make regular payments on property taxes and homeowners insurance. This allows retirees to use the wealth they have accumulated in their homes to help cover their cost of living.
There are, however, a lot of reverse mortgage scams to watch out for. Some companies will outright lie to sell their services to unsuspecting and desperate seniors. The only reverse mortgage insured by the U.S. Federal Government is the Home Equity Conversion Mortgage (HECM). Through the HECM program, you will be able to withdraw some of your home’s equity. The amount available for withdrawal will vary from person to person and depends on the age of the youngest borrower, the current interest rate if your mortgage is not paid off, and the value of your home.
If you find it is impossible to stay in your current home, HUD also provides help for seniors looking to move into lower-income housing through senior housing vouchers, Section 202 supportive housing, and public housing.
The Housing Choice Voucher Program (HCVP) allows seniors to look for housing in the private sector amongst specific properties run by local public housing agencies including single-family homes, townhouses, and apartments. There are two kinds of vouchers: tenant-based vouchers, which move with the renter – and project-based vouchers, which are assigned to specific units and are not transferable. Typically, rent and utilities are calculated at 30% of the monthly adjusted gross income and the voucher will make up the difference in expenses. In order to find out if you or your loved one qualifies for this program, you will need to contact your local public housing agency.
Established in 1959, the Section 202 supportive housing program is the only HUD program specifically created to provide housing for seniors and those with disabilities. This program is designed to help seniors live as independently as possible while also offering assistance with daily living. Assistance can include dressing, bathing, housekeeping, and transportation. In this program, HUD provides loans to private and nonprofit organizations to finance the building and management of supportive housing services along with rent subsidies for residents. Typically, seniors that are 62 or older and have a very low household income (the average yearly income for Section 202 residents is $10,000/year) are eligible for this program. To apply, you will need to contact the individual housing community you are interested in.
Public housing for seniors includes high-rise apartments and duplexes that are operated by the local public housing agency. In this program, seniors will typically spend about 30% of their household income for rent and utilities. It is important to note that due to the limited resources available to HUD and local housing associations, there are typically long waiting lists for public housing. That is why is it important to be proactive and get in touch with your local public housing agency in order to determine your eligibility and explore all of your housing options.
Veitengruber Law is ready to offer expert advise on housing solutions for NJ seniors. Our goal is for you or your loved one to age in comfort and security. If you are looking for housing options for yourself or an aging parent or relative, it is important to know what resources are right for you. Call us today for your free consultation.