This report, "Mortgage Denial Rates and Household Finances among Older Americans," was prepared by the Urban Institute. The report focuses on mortgage denial rates for seniors and trends in senior debt, home equity, and net worth. The report finds that older applicants face the highest denial rates for forward equity extraction and that a third of senior refinance applications are denied because of high debt-to-income (DTI) ratios. Low incomes and deteriorating credit scores partly explain high DTI ratios among seniors. The report also notes that seniors' use of cash-out refinances and home equity conversion mortgages (HECMs) increased from 2018 to 2020. Despite rising indebtedness, seniors have stable net worth thanks to home equity. The report concludes that senior household finances have deteriorated and debt levels have increased over the past 30 years, but senior homeowners have experienced increasing debt burdens. Overall, the report provides valuable insights into the challenges faced by older Americans in accessing mortgage financing and managing their household finances.
