The median amount older homeowners owed on mortgages jumped 82% from 2001 to 2011, increasing from approximately $43,400 to $79,000, which is jeopardizing retirees’ financial security, according to the Consumer Financial Protection Bureau.
In a Wednesday report, "Snapshot of Older Consumers and Mortgage Debt," the CFPB’s Office for Older Americans says that Census data shows that the percentage of homeowners age 65 and older with mortgage debt increased from 22% to 30% (3.8 million to 6.1 million homeowners) from 2001 to 2011. Additional data from the Federal Reserve shows that consumers older than 75 had the greatest increase during this period, and that the proportion of consumers 75 and older with mortgage debt more than doubled from 8.4% to 21.2%.
The CFPB report notes that in general, older consumers are carrying more debt, including mortgage, credit card, and even student loan debt, into their retirement years than in previous decades.
“Carrying a mortgage well into retirement poses many potential challenges for older Americans who typically live on reduced income yet face increased expenditures for health and long-term care,” the report states.
The Office for Older Americans also found from July 2011 through December 2013, consumers 65 and older submitted approximately 15,500 complaints on a range of financial products and services, with about one-third of their complaints, 32% being about mortgages.
The most common types of mortgage complaints from older consumers (46%) concerned problems they face when they are unable to make payments (such as issues relating to loan modifications, collections or foreclosures). Other common types of mortgage complaints (32%) involve problems older consumers have when making payments (such as issues with loan servicing, payments, and escrow accounts).