Welcome to a new era in home borrowing, where long-term mortgages and home equity loans are taking their place alongside AARP cards and pension checks as never before. About 25% of all Americans over age 65 have yet to pay off their home loans, up from 11% in 1983, according to a Boston College analysis of Federal Reserve Board data.
For many older homeowners, the decision to carry housing debt deeper into their twilight years is by choice. They see their homes â€” rather than savings accounts â€” as piggy banks that can be tapped through home equity loans or refinancings to provide ready cash. But the trend also reflects sober realities, including lifestyle changes from an earlier, more debt-averse era. People who marry or remarry in middle age often find themselves making down payments on a home at a stage in life when their own parents had already paid off the mortgage. Others are able to pay off their mortgages, but opt to refinance to help make ends meet in retirement â€” pushing their debt deep into old age.