Exactly how many Americans age 50 and older are feeling the blunt impact of the housing crisis? In an unprecedented study, AARP reveals for the six-month period ending in December 2007, 684,000 Americans age 50 and older were either in foreclosure or were delinquent in mortgage payments. This is more than a quarter of all foreclosures or delinquencies. Delinquency normally refers to mortgage payments at least 30 days in arrears. Furthermore, the study shows African Americans and Hispanics are being hit hardest.
“The public perception is that older Americans are financially secure in their homes,” says Susan Reinhard, director of AARP’s Public Policy Institute. “But the reality is that while many are in fact secure, hundreds of thousands of others are not and face unsettling uncertainty over their futures as homeowners.”
Other key findings:
- African-Americans and Hispanics are disproportionately affected in comparison with whites in their age group.
- Among mortgage holders aged 50 and over, African American and Hispanic borrowers both have foreclosure rates of 0.51 percent, compared to a rate of 0.19 percent for Caucasians.
- Older Americans are severely impacted by holding subprime loans.
- Older holders of subprime first mortgages are 17 times more likely to be in foreclosure than are older holders of prime loans.
- While older Americans are clearly vulnerable to the continuing mortgage crisis, the foreclosure rate at the end of last year for people aged 50 and over was 0.24 percent, compared with a total all-age U.S. average of 0.39 percent.