Gold watches aren’t the only thing some retirees are taking with them into retirement: they’re also carrying a mortgage…

Gold watches aren’t the only thing some retirees are taking with them into retirement: they’re also carrying a mortgage.

According to American Financing’s “Retirement and Mortgages” survey, nearly half (44 percent) of all 60- to 70-year olds exit the workforce while still making house payments. A third say it will be eight more years before their home loans are paid off, and 17 percent say they may never pay off their mortgages.

The survey results from this Aurora, Colorado-based family-owned mortgage banker are worrisome, not just for seniors but also for real estate professionals who hope to mine the senior market. As numerous other studies have pointed out, many seniors plan to stay put.

“Part of the American dream — and homeownership — is the expectation that after years of hard work, you can retire with financial security,” says Carrie Niess, a business analyst at American Financing. “But the unfortunate reality for many of today’s Baby Boomers is that their debt burden remains high.”

The study squares with recent Fannie Mae findings that today’s boomers have a greater likelihood of carrying mortgage debt than previous generations. Perhaps because they still owe on their current house, 64 percent of the 800 60- to 70-year-olds polled online by American Financing using SurveyMonkey said they plan to remain in their present residences as they age. Sixty-two percent of those folks expect to leave their manses to their children or estates rather than put them on the market to the general public.

Nearly 60 percent of those who still have a mortgage refinanced at some point, largely to obtain a lower interest rate. But in so doing, most extended the length of their loans. And now, just when they are ready to hang up their working togs, they still owe their lenders.

The survey did not ask how much participants still owe. But how long they have to go varies all over the ballpark: 20 percent have less than a year to pay off their loans, and 6.5 percent have just one to two years, according to the survey. But almost 14 percent have three to five years before their houses are paid in full, 11 percent have six to eight years, 32 percent have more than eight years and 17 percent say they may never be able to burn their mortgages.

“Many in this age group will continue to bear the burden of debt well into their 70s,” the report noted.

American Funding’s online survey also found that 71 percent of the respondents would be more likely to make home renovations rather than move if a health issue affected their mobility or comfort at home. Fortunately, there are options to help seniors deal with that possibility: They can pay cash if they have the wherewithal to make the necessary improvements. They can refinance, take out a home equity loan or possibly even a home equity conversion, or reverse, mortgage.

Nearly 63 percent of the participants believe their savings would cover home renovations if modifications became necessary. But the rest were unsure of what they would do — or what their options are — should they run low on funds in retirement. For example, one in five had no clue about reverse mortgages or how they work.

“One question [that] needs to be asked: How will these individuals afford to remain at home and make modifications if they run out of savings?” the report said.

With the continued rise in property values as well as growth in the equity owners have in their homes, American Funding believes reverse mortgages are worth exploring. But the lack of knowledge about them is problematic, it said.

This lender isn’t the only entity to raise the issue recently of seniors’ lack of awareness when it comes to their options. Earlier this year, the Urban Institute blamed a variety of factors for what it called the underutilization of home equity in retirement, from misinformation about the risks and cost to the lack of a brand-name presence in the marketplace.

Lew Sichelman’s weekly column, “The Housing Scene,” is syndicated to newspapers throughout the country.

Email Inman.

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