Three Million Seniors at Risk of Losing Homes: AARP
With a homeownership rate for people age 50+ at 80%, the percentage of people carrying mortgage debt as they age and the amount of that debt have increased steadily over the past 20 years. The largest increase in the percentage of older homeowners with mortgage debt has been the 75+ age group. The 55-64 and 65-74 age groups have also exhibited sharp increases in mortgage debt. This increase partly reflects increased borrowing that was spurred by historically low interest rates and high home values prior to the housing market collapse. It may indicate that the oldest borrowers have tapped their home equity to finance their needs in retirement.
This trend, unfortunately, triggers a domino effect, with older Americans raiding their retirement funds to pay their mortgages, leaving them with less cash to eat, pay bills, and enjoy their retirements. That's a problem that is difficult to reverse.
"More older Americans are carrying mortgage debt than in the past, and the amount of that debt is also increasing ... leading to their worsening situation," said Debra Whitman, AARP executive vice president for policy, in a statement. "It's one thing if your housing value goes down in your 50s. It's another thing if you're 75. For some people, it's not like you can go back to work."
--By Brian O'Connell