Seniors aged 62 or older added $149 to their home equity in the last quarter of 2017, taking total equity in seniors’ homes to $6.6 trillion according to the National Reverse Mortgage Lenders Association.
Its NRMLA/RiskSpan Reverse Mortgage Market Index hit 238.11 in Q4, 2017, a new all-time high in its 18-year history.
The growth in equity was driven by home values rising approximately 2% ($163 billion) but was offset by a 0.9% ($13.4 billion) increase in mortgage debt.
The index increased by 8.3% in the whole of 2017, compared to an annual increase of 8.0% in 2016 and 8.5% in 2015.
“Today’s retirees are more likely to leave the workforce with a mortgage and other debts that can put stress on monthly cash flow,” said NRMLA President and CEO Peter Bell. “In these situations, financial products that convert home equity to cash could be used to pay off revolving debt from credit cards and reduce or defer monthly mortgage payments. It’s worth doing the math to find out if a mortgage refinance, home equity line of credit, or reverse mortgage loan can help increase financial security during retirement.”
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