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Seniors see debt ahead

A survey finds that many don't expect to pay off their home loans -- ever.

September 23, 2007|Ines Santos | Times Staff Writer

It's survey time. Three recent ones looked into baby boomers' mortgage habits, seniors' real estate plans and homeowners' views of the associations that represent them. Here's what they found:

* Forget the mortgage burning party. Forty percent of seniors ages 62 to 75 expect to retire with mortgage debt, and some expect never to pay it off, according to a survey by Financial Freedom, a subsidiary of IndyMac Bank that specializes in reverse mortgages.

Of the 1,129 seniors surveyed, 63% owed more than $50,000 and 31% owed more than $100,000. Fifty-six percent of respondents expected to take 10 years or more to pay off their loans, and 11% said they didn't expect to pay off their mortgages completely.

The survey also found a significant decline in the number of seniors planning to leave their houses to their heirs -- from 42% in 2006 to 25% in 2007. More than 50% of respondents said they would use their homes as a retirement asset, 12% of them said they planned to sell their houses and the remaining said they would consider doing so if needed for income.

Despite mortgages and other debt, the vast majority of surveyed seniors said they were somewhat confident or very confident in their retirement income.

* ERA Real Estate, also trying to figure out what aging baby boomers will do in their retirement, learned that 1 in 5 respondents were planning to change houses in the next five years, most moving to single-family homes.

The real estate company found that more people in the 50-plus age group hoped to move to a larger house, not a smaller one. Only 11% of the 1,000 people surveyed currently living in single-family homes are considering a move to a town house, condo or apartment.

Six percent of respondents said they would consider moving to active adult communities, a marked increase from last year's 2%, with men considering these communities three times as much as women.

* As for condo living, in an unrelated poll, two-thirds of owners declared their homeowners association to be either a major headache or a minor annoyance.

Of more than 3,000 homeowners who responded to a survey by the website ServiceMagic.com, 19% said they have had an "all-out war" with a homeowners association and 55% said they would rather live with a sloppy neighbor than in a neighborhood with an association.

--

ines.santos@latimes.com

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