Let’s Take a Look at Some Reverse Mortgage Statistics

You know, reverse mortgages, especially the ones backed by the FHA called HECMs, have really changed a lot in recent years. They’re not just for people in tough financial spots anymore. More and more, I’m seeing folks use them as a smart way to tap into the equity they’ve built up over time without having to sell their home or take on monthly payments.

What’s interesting is how people are using them. It’s not always about covering emergencies, sometimes it’s about creating some breathing room in retirement, preserving savings, having a backup plan or using the money to live life to the fullest and checking a few things off their bucket list. A lot of people prefer the line-of-credit option too, so they can access funds when they need them instead of taking everything all at once. It’s really becoming more of a strategic move than a last resort. And depending on where you live, you might see more neighbors doing the same thing, especially in areas with higher home values. These insights not only reflect growing interest among aging homeowners but also suggest a broader shift toward more strategic, equity-based retirement planning.

These statistics provide insight into the current landscape of reverse mortgages, highlighting borrower demographics, geographical trends, and market dynamics nationwide.

Demographics of Borrowers:

• Gender: Approximately 39% of HECM borrowers were single females, 20.8% were single males, and 35% were multiple borrowers.
  
• Ethnicity: In FY 2024, 66% of HECM endorsements served White borrowers, 6.58% served Black borrowers, and 4.84% served Hispanic borrowers. ​
  
• Age: The average age of reverse mortgage borrowers was approximately 74.84 years in FY 2024. ​

Geographical Distribution:

• California represented nearly 27% of all HECMs in FY 2024. Other leading states included Florida (9.65%), Texas (6.34%), Colorado (5.92%), and New York (2.52%). 

Loan Amounts:

• The median amount loaned from reverse mortgages nationwide was $135,000, with the median home value of those obtaining a reverse mortgage at $305,000. In California however, the median home value of those obtaining a reverse mortgage in 2024 was $859,800.​

Payment Options:

• Approximately 93% of HECM borrowers opted for the line-of-credit payment option in FY 2024. 

Market Trends:

• Despite a decline in the number of HECMs between 2009 and 2019, there was a resurgence in the following years, with 2022 recording the highest 10-year figure. 

As the cost of living continues to rise, statistics show, as noted above, that many seniors aged 70 and above are finding it increasingly difficult to maintain a comfortable lifestyle on traditional retirement income alone. Social Security, while helpful, was never intended to cover all living expenses – especially in today’s economy where healthcare, housing, and everyday costs have climbed significantly. According to recent data, a growing number of older adults are tapping into their personal savings more quickly than planned, and many are facing retirement shortfalls that put strain on their financial well-being.

What’s more, lifespans are increasing, which means retirement savings need to stretch further than ever before. Perhaps you are experiencing that now as you read this. Seniors in their 70s are living well into their 80s and 90s, and while that’s great news, it also creates a greater demand for reliable income sources that can support long-term needs. Unexpected medical expenses, in-home care, and inflationary pressures only add to the challenge. For many seniors, the solution lies in unlocking alternative sources of funding, like home equity, to bridge the gap between fixed income and actual living costs, ensuring a more secure and stress-free retirement.

Remember the old adage… “You only get out of it what you put into it.”? Well, you’ve invested a great deal into your home over the years, and now’s the time to reap the benefits – for the comfortability and convenience of living your life.