More than 1.5 million older Americans have lost their homes to foreclosure and millions more are at risk, according to a new AARP report. The risk appears to be greatest among Americans 75 years and older, as well as minority home owners.
About one in 30 adults 75 and older face foreclosure today. That's significant when compared to 2007, when one in 300 home owners aged 75 and older were at risk of foreclosure.
Furthermore, older minorities — particularly African Americans and Hispanics — have foreclosure rates that are nearly double than those of white home owners at the same age, the report notes.
What’s more, the number of older adults who are underwater on their mortgage is alarmingly high. About 3.5 million — or 16 percent of older home owners — have underwater mortgages, which could put them at risk of foreclosure.
“The Great Recession has been brutal for many older Americans,” says Debra Whitman, AARP’s policy chief.
Just in the past five years, the number of loans held by older Americans who are seriously delinquent on their mortgage soared more than 450 percent.
Many older adults live on fixed incomes and are in retirement, which makes catching up with their mortgage payments once they fall behind particularly difficult.
Rep. Elijah Cummings, D-Md., is pushing the federal government to do more to help older Americans keep their homes, such as by promoting more mortgage principal reductions and loan-modification programs.
"These are people who in many instances have never missed a payment in 20 years," Cummings told the Associated Press. "You see grown men crying because of the potential loss of a home."
Source: “Foreclosure Crisis Hits Older Americans Hard,” Associated Press (July 19, 2012) and Realtor Magazine.