Growing reverse-mortgage defaults put homeowners at risk of foreclosure
Thousands of older homeowners in Florida who tapped the equity in their paid-off homes to boost their income now face the possibility of foreclosure as the number of defaults on such “reverse mortgages” skyrockets.
More than 30,000 U.S. homeowners are in “technical default” on their reverse mortgages and could lose their homes because they have failed to pay their property taxes or property-insurance premiums, according to a new research report based on the latest government data.
Florida leads the country in terms of the number of defaults, with nearly 5,300, or about 18 percent of the U.S. total, according to the CredAbility Group, a nonprofit consumer-credit counseling service based in Atlanta.
Florida’s reverse-mortgage-default rate stands at about 8 percent, compared with a nationwide rate of 5 percent.