Boomers Help Children, Buy Homes by Jim Woodard on Creators.com

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Boomers Help Children, Buy Homes

An interesting trend is surfacing in today's housing industry. More first-time homebuyers are being financially assisted by their parents.

This is particularly noticeable when the parents are among the baby boomer generation. They are showing an intense interest in helping their children and grandchildren become homeowners.

A national survey recently commissioned by Better Homes and Gardens Real Estate LLC, a major broker franchise network, found that baby boomers are part of a growing trend — helping their children or grandchildren become homebuyers.

According to the survey, 1 in 5 baby boomers has already gifted, loaned or co-signed a loan to support their children or grandchildren in purchasing a home, and more than two-thirds of baby boomers want to provide this type of support in the future.

Looking ahead, 1 in 10 baby boomers will "definitely" provide their children or grandchildren with financial support for a down payment on a home.

Aside from the good investment rationale, baby boomer respondents cited that the willingness to provide financial support to their children and/or grandchildren was out of love. By providing financial support to assist in the first-time home buying process, respondents stated they could ensure their children and/or grandchildren would benefit from their estate and fulfill a large part of achieving the American dream.

"In today's economy, saving enough money for a down payment can be a struggle for young adults," said Sherry Chris, president and CEO of Better Homes and Gardens Real Estate. "Baby boomers are a unique generation that has driven the economy for the past 30 years. Our survey data shows that they are using what they've earned and what they've learned to invest in the future and help their children and grandchildren realize the American dream of homeownership."

Another interesting point revealed in the survey: Baby boomers show more interest in "gifting" or loaning money than in co-signing loans.

Q: Is there a holiday moratorium on foreclosures?

A: Both Fannie Mae and Freddie Mac announced foreclosure moratoriums on all single-family homes and two-to-four unit properties over the holidays.

Both companies will enforce the moratorium from Dec. 19 through Jan. 2.

The suspension will not affect the pre- or post-foreclosure processes. Servicers may continue the administrative processes involved in foreclosures, but evictions will be delayed until after the start of the new year, it was announced.

Q: Who is guarding homeowners from online mortgage rescue scams?

A: The Office of the Special Inspector General for the Troubled Asset Relief Program is waging a strong battle against mortgage and foreclosure rescue scammers that advertise online. The agency recently announced it halted 85 online scams that promised to help homeowners pursue mortgage loan modifications.

Some scammers disguise themselves as government agencies by using government seals or adopting names that are similar to those of a government agency, the agency revealed.

The agency also noted that scammers often ask homeowners for an upfront fee to help them pursue a modification through the Home Affordable Modification Program. They then advise the homeowner to discontinue his or her mortgage payments and terminate any contact with his or her lender.

Q: Are home sales starting to grow?

A: Sales are increasing in most markets. Pending home sales (contracted but not yet closed) for single-family homes grew by 10.4 percent in October from a month earlier, according to the National Association of Realtors.

Sales surged in the Northeast region, up 17.7 percent in October from a month earlier. Pending home sales in the West fell, but by only 0.3 percent.

Q: Is there a downside to purchasing a home warranty contract?

A: One downside is expressed in a letter posted on the Trulia.com website:

"I am a seller with an opportunity to purchase a home warranty, and while it seems like a good thing, I am concerned with all the small print which seems to benefit the warranty company at my expense. I do not want to purchase 'peace of mind' only to discover at a later date that some small print exception disallows a claim."

However, it should be noted that most homebuyers today view the protection from a home warranty contract to be worth its expense. But it's important to shop and compare offers from different warranty companies.

To find out more about Jim Woodard and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.