So the AARP released a “first-of-its-kind” study that reveals older homeowners are not exempt from the ongoing mortgage crisis, significant considering the home is a nest egg for most.
According to their research, during the six month period ending in December 2007, 684,000 homeowners aged 50 or older were either late on their mortgages or in the foreclosure process.
That total accounts for 28.1 percent of all delinquencies and foreclosures in the U.S.
“The public perception is that older Americans are financially secure in their homes,” said Susan C. Reinhard, Senior Vice President for Public Policy at AARP. “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.
“Older Americans depend on their homes both for shelter and as a retirement asset,” Reinhard added. “Losing a home jeopardizes long-term financial security, for older Americans it also leaves them with limited time to recover.”
The study also found that older borrowers holding subprime loans were 17 times more likely to be in foreclosure than prime mortgage holders.
Additionally, African-American and Hispanic borrowers were disproportionately affected by the mortgage crisis, with foreclosure rates of 0.51 percent, compared with a rate of 0.19 percent for white borrowers.
Overall, older borrowers experienced a foreclosure rate of 0.24 percent, compared with 0.39 percent for the all-age U.S. population.
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