A new report released by Lending Tree, the online loan broker, analyzes the changing behaviors and attitudes of Americans toward debt at different stages of their lives - from college student to senior citizen. The study only touches on reverse mortgages for senior citizens briefly, but what it has to say isn’t encouraging:

In contrast to other cohort groups, who view housing primarily as an investment, Seniors tend to view their homes in terms of functionality first, followed by investment potential. Indeed, 33 percent reported that they perceived their homes primarily as shelter, whereas only 14 percent responded that their homes were primarily investment vehicles; the remaining 53 percent responded that they perceived their homes as a combination of shelter/investment. For the participants who have owned their homes for more than 20 years, they indicated that their homes have appreciated at least 100 percent over the last decade, nearly tripled over the last 20 years, and quadrupled over the last 30 years. Many have either paid off their mortgages or will finish paying them off within the next five years. Although nearly one-half have taken home equity loans, only one-fifth responded that they would consider a reverse mortgage.

The low level of acceptance (or understanding) of reverse mortgages isn’t surprising. The concept runs counter to core values that most of today’s seniors have held their entire lives - i.e. that increasing personal debt is associated with irresponsibility.

However, the study also highlights that younger generations consider higher debt levels a normal state of affairs - “an inevitable and likely permanent feature of everyday life.”

The Lending Tree study is an interesting read and can provide a reference point for checking your personal beliefs about consumer debt with your peers.

Both the full report and an “executive summary” are available for free download (in pdf format) at Lending Tree.

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A Few More Related Articles of Interest:

Using a Reverse Mortgage to Get Out of Tight Spots

Reverse Mortgages and Predatory Lending

September Senior Surveys

Reverse Mortgage Pro and Cons

7. How important is the goal of leaving a bequest?