By Kathryn Arbour
A recent report from AARP (click here to see report) underscores the toll the housing crisis has taken on older adults. More than 1.5 million seniors have lost their homes. The most vulnerable of older adults are ill-equipped to survive such economic turbulence, especially those who have also lost jobs and other sources of income. The report, entitled “Nightmare on Main Street,” highlights African-Americans and Latinos as being the hardest hit.
Debra Whitman, AARP’s policy chief, commented, “You may have been working for years toward paying your mortgage, and the security you thought you’d have isn’t there.” The findings of their study demonstrate the fragility of Boomers and older adults who have gotten caught in the mortgage crisis, having depended on their home equity for years to assist with home maintenance, medical bills, and long-term care.
Delinquency on mortgage payments is up over 450 percent on loans held by older Americans. Even those working two jobs report an inability to keep their mortgages current in some cases.
As the economic and housing crises persist, AARP predicts that another 3.5 million are at risk of losing their homes. This represents 16% of older homeowners. Their homes are valued at less than the amount owed on their mortgages. The National Mortgage Settlement , an agreement worked out with States, the Federal Government and five banks, will provide up to $25M in relief to homeowners who are “underwater.” The details are still being worked out on how exactly these funds will be accessed.