CFPB: Older Americans face debt challenges
WASHINGTON – June 9, 2014 – The Consumer Financial Protection Bureau (CFPB) released a snapshot report spotlighting the mortgage debt challenges faced by a growing number of older Americans.
These challenges include more mortgage debt, less affordable housing and a greater risk of foreclosure. The CFPB is also issuing a consumer advisory today reminding older consumers approaching retirement to think about their mortgage pay-off date and to consider their retirement income and expenses.
"A home can be a place of security for older Americans in their retirement years – a roof over their heads as well as a valuable asset," said CFPB Director Richard Cordray. "But as more seniors carry significant mortgages into retirement, they put themselves at risk of losing their nest eggs and their homes."
The Snapshot of Older Consumers and Mortgage Debt is available online at CFPB's website.
Approximately 80 percent of the 41 million Americans age 65 and older own their home – the highest homeownership rate among all age groups. But while their rate of homeownership has remained constant over the last decade, the percent of older homeowners holding mortgages has increased.
Much of the increase can be attributed to the refinancing boom of the 2000s. Other factors include a general trend among Americans to buy their first home later in life, provide small down payments on home purchases, and borrow against their home equity to pay for a variety of expenses.
The report gathered and analyzed data from the Census Bureau, the Federal Reserve and consumer complaints submitted to the CFPB, among other sources.
Managing mortgage debt in retirement
Because mortgage debt is such a significant issue for older Americans, the CFPB issued an advisory highlighting three issues that older Americans should consider while managing mortgage debt in retirement:
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