Consumer Bankruptcy News reports in its August 8th issue, that more than 1.5 million Americans age 50 and over have lost their homes since 2007, citing a new study by AARP's Public Policy Institute. The study also found that the percentage of seriously delinquent loans - those in foreclosure, and loans 90 or more days delinqent - increased from 1.1 percent in 2007 to 6 percent as of the end of last year for homeowners age 50 and older.
The article states that, as those percentages indicate, the foreclosure crisis for older homeowners is far from over, and that the numbers behind those percentages show just how far from over it is. According to the report, 600,000 loans are in foreclosure and another 625,000 are seriously delinquent. In addition, 3.5 million loans held by people age 50 and older were under water.
"The collapse of the housing market has been especially painfull for older homeowners," said Debra Whitman, AARP Executive Vice President for Policy.
"Older homeowners often rely on their home equity to finance their needs in retiremenet - things like health care, home maintenance and other unexpected needs. The fact that so many older Americans have no equity at all is troubling."
The report noted that the serious delinquency rates are lower for those aged 50 and older than they are for those under age 50; however, serious delinquencies went up faster for the older population over the past five years. The study also found that people age 75 and older have a higher foreclosure rate (3.2 percent) than those age 50 to 64 (3.0 percent) or age 65 to 74 (2.6 percent).
"More older Americans are carrying mortgage debt than in the past, and the amount of that debt is also increasing," Whitman continued. "Because before-tax income has decreased on average for people age 75 plus, while spending for mortgage interest, property taxes, utilities and health care have increased, their economic situation is worsening."
(The AARP study is available at www.aarp.org)
