Colorado Reinstates Property Tax Exemption For Seniors

Colorado’s property tax exemption for seniors has been reinstated by the State Legislature following a three-year suspension. State lawmakers suspended the voter-approved Senior Property Tax Homestead Exemption program for tax year 2009, payable 2010, due to State budget shortfalls, but restored it during the 2012 General Session for tax year 2012, payable in 2013.  

Under the exemption, qualifying residents age 65 years or older will see 50 percent of the first $200,000 of actual value of their primary residence exempted from property tax. To qualify, at least one owner of a home must be 65 years or older, and must have occupied the home as a primary residence for at least 10 consecutive years prior to Jan. 1 of the year in which he/she applies.

Once an exemption application is filed and approved, it automatically carries over from year to year as long as nothing changes in the ownership or occupancy. The State reimburses Colorado counties for the exempted taxes.

“Arapahoe County residents who have previously applied for the property tax exemption do not need to reapply,” said Arapahoe County Assessor Corbin Sakdol. “Once an application is received, our office will process and notify the status to the applicant. For applications that are approved, the exemption will automatically appear on your 2013 tax notice.” 

The Arapahoe County Assessor’s Office can assist residents with filing an application or verifying if their property was already approved for the tax exemption. Applications for a Senior Property Tax Exemption must be received by the Assessor’s Office by July 15 for the first year for which you are seeking exemption.

To download an application form or for more information, please contact the Arapahoe County Assessor’s Office at 303-795-4600 or visit www.co.arapahoe.co.us and click on “Departments” and then “Assessor.”

Source: http://aurora.kdvr.com/news/business/125311-colorado-reinstates-property-tax-exemption-seniors


How To Buy A Home On A Retiree’s Budget

By Tara-Nicholle Nelson, Monday, March 12, 2012. Inman News®

Q: How do retired  people with a mortgage-free home and a limited budget (Social Security and  retirement) sell and buy a home? Would they qualify for a mortgage or have to  sell the home before buying a new home? Are there creative ways to do this? –Sue

A: I suspect this question will be coming up more and more  often in the future, as baby boomers continue to retire. It’s important to note  that many do continue to work on some level after retirement, and many don’t  own their homes free and clear. It seems like congratulations might be in order  for being able to completely retire and pay your house off (or keep it  mortgage-free)!

1. Income is as  income does. Most lenders will use retirement income, including a pension  or monthly Social Security stipend, to qualify a borrower for a home mortgage.

They view it and treat it just like they treat salary or  wages — and they require you to document it in a similar way. The lender will  want to run your credit; see your most recent tax returns, as well as  statements from all your accounts (including any retirement accounts); and see  your Social Security and pension or other retirement system award letters.

2. You might need to  sell, then buy — or not. While it’s true that your retirement income looks  just the same to lenders as another borrower’s employment income does, debt-to-income  ratios and income documentation guidelines have tightened up so much that it  can be difficult to qualify for a new mortgage without the cash in the bank  from your existing home. So the fact that you own your current home free and clear  is a huge benefit.

While the lender won’t necessarily give you any credit for  your existing home (i.e., lenders won’t make presumptions about when or for how  much you’ll sell it, or how much cash you’ll end up with in hand when you do),  neither will it serve as a liability on your mortgage application the way it  would if it you were obligated to make a monthly mortgage payment on it.

The fact is, there are challenges and benefits either way  you go, whether you decide to sell first or buy first. Obviously, if you sell  first, you have the challenge of finding a place to live while you house hunt. On  the flip side, you have the security of knowing exactly what your proceeds of  the sale will be before buying, which might help you buy well within your  means.

Also, if you decide to buy first, you’ll face the possible  stressors involved if your home takes a long time to sell or sells for less  than you expected, not to mention the challenges of a mortgage payment you’re  not used to and the financial burden of maintaining and paying property taxes  on two homes at once.

3. Get briefed on all  your options. Ask your friends and relatives if they have a mortgage broker  they trust implicitly, and set an appointment to get the pro’s input on your  next steps. The mortgage broker can run all the numbers involved and tell you  what you should be able to qualify for, dollar-amount-wise, before and after  you do get your home sold.

The mortgage broker will also give you all of your options,  including whether you can qualify for a new mortgage without selling. For  instance, if (1) you’re buying to downsize, (2) moving to a less expensive  area, (3) you have a hefty savings or asset portfolio or (4) the homes you’re  targeting are modestly priced vis-à-vis your income, you might not need to sell  your existing home before you qualify to buy the next one.

They might also offer you some more creative options, and  sketch out the financial details of what some alternative scenarios would look  like. For example, a mortgage broker might help you consider essentially  refinancing your existing home, borrowing enough cash to fund your next purchase,  then paying that loan back from the proceeds when you do get your home sold.

4. Get creative.  If, in all the time you’ve ever owned a home, you ever fantasized about the  adventures you’d undertake if you were footloose and fancy-free, consider taking  this opportunity to go for it!

Sell your home, then rent a chic loft or a writer’s cabin  somewhere, or travel for a year, while you house hunt.

And there are some other, more inside baseball-style  creative options to explore, in the same vein of taking out a mortgage on your  existing house to pay for your next one.

Talk with a local agent about the possibility of selling  your home, then leasing it back from the buyer. Also, when you talk with your  mortgage pro, explore the prospect of relatively short-term financing for your  new home, which might offer a lower interest rate and monthly payment than a  long-term loan, and which might make sense if it’s truly realistic that you’ll pay  it off in the near future when you do get your home sold.

Work with a local real estate agent who has a recent track  record of success at selling homes in your area, and bring your tax, financial  planning and estate planning advisers into the conversation as you try to  understand and explore the full spectrum of available options. If you have such  a team in place, take maximum advantage of their thoughts and experience as you  put your personal action plan in place.