WASHINGTON, Dec. 23, 2015 /PRNewswire/ -- The National Reverse Mortgage Lenders Association reports today that an estimated $147 billion increase in the aggregate value of homes owned by seniors drove their share of home equity to $5.76 trillion and rocketed the NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI) to an all-time high in Q3 2015 of 200.19 from 195.42 in Q2.
Mortgage debt held by seniors increased slightly from $1.45 trillion to $1.46 trillion last quarter, but the uptick was barely a dent in home equity levels, which have climbed steadily for 18 consecutive quarters.
The Q3 numbers are based on a revised methodology that includes data from the 2013 American Community Survey and the Federal Reserve's Z.1 Release to estimate the value of aggregate senior home equity underlying the RMMI.
"The recalibrated index uncovered something we didn't expect to see, which was that senior housing values outperformed the general population. In metro areas hard hit by the Great Recession, for example, senior home values were more resilient to declines. It's great news for seniors who are considering tapping their housing wealth to support their retirement planning," said NRMLA President and CEO Peter Bell.
The changes in methodology and data source updates resulted in a very significant 37% increase in the aggregate value of senior equity.
The RMMI is updated quarterly and tracks back to the start of 2000. Release dates for 2016 are:
Q4 2015: 3/22/2016
Q1 2016: 6/21/2016
Q2 2016: 9/20/2016
Q3 2016: 12/20/2016
About Reverse Mortgages
Reverse mortgages are available to homeowners age 62 and older with significant home equity. They are a safe financial tool seniors can use to borrow against the equity in their home without having to make monthly payments as with a traditional "forward" mortgage or a home equity loan. Under a reverse mortgage, funds are advanced to the borrower and interest accrues, but the outstanding balance is not due until the last borrower leaves the home, sells, or passes away.
To date, more than 930,000 senior households have utilized an FHA-insured reverse mortgage. More than 616,000 senior households are currently using a reverse mortgage to help meet their financial needs. For more information, please visit www.ReverseMortgage.org
About the National Reverse Mortgage Lenders Association
The National Reverse Mortgage Lenders Association (NRMLA) is the national voice for the industry and represents the lenders, loan servicers, credit unions, and housing counseling agencies responsible for more than 90 percent of reverse mortgage transactions in the United States. All NRMLA member companies commit themselves to a Code of Ethics & Professional Responsibility. Learn more at www.nrmlaonline.org.
Contact: Jenny Werwa
National Reverse Mortgage Lenders Association
JWerwa@dworbell.com (202) 939-1783
SOURCE National Reverse Mortgage Lenders Association