St Casimirs Mortgage Minute

CFPB Examines Senior Citizens’ Mortgage Debt

Mortgage debt is rising among senior citizens, the Consumer Financial Protection Bureau said in a report yesterday. While a little over 80 percent of Americans over 65 own their home -- a consistent figure over time -- the percentage of seniors who carry a mortgage has risen from 22 percent in 2001 to 30 percent in 2011.

A boom in refinancing, a trend toward buying a first home later in life and home equity borrowing all contributed to the increase in mortgage debt, the bureau said. Seniors’ average outstanding balances relative to the value of their homes also rose from 30 to 46 percent over 2001-2011.

“Decreased home equity wealth is a great concern in light of Americans’ increased longevity and lack of financial preparedness for retirement,” the CFPB said. “For many, home equity -- which is often their primary and sometimes only asset -- may not be there when they are likely to need it later in life.”  

---ABA Daily Newsbytes