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Lawsuit grinds real estate sales to a halt

Why it pays to get a mortgage for retirement home
Published on Apr 5, 2004

DEAR BOB: Thank you for your great advice to another reader about eight months ago. You suggested she not pay all cash for her retirement condo and instead obtain a mortgage for 75 or 80 percent of the purchase price. The reason you gave was to avoid tying up a large amount of her retirement cash. As we were about six weeks away from buying a brand-new house in a retirement community, we decided to also follow that advice. Now we are so thankful we did. Although we could have paid all cash, instead we paid a 25 percent down payment and got a 75 percent mortgage at 5.75 percent interest. Shortly after we bought, the homeowner's association sued the developer over faulty underground utilities, construction defects and other problems. As a result, sales of new homes in the development quickly ground to a halt until the litigation is resolved. We're so glad we didn't tie up a big chunk of our nest egg – Mark H. DEAR MARK: I greatly appreciate your sharing your new-home purchase expe...

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