Retired but Still Paying a Mortgage? You’re Not Alone

Retired but still paying mortgage

For many Americans, the dream of entering retirement mortgage-free is just that—a dream. In fact, a growing number of retirees in the U.S. are carrying mortgage debt well into their golden years. According to data from the Federal Reserve and other recent studies, nearly 40% of homeowners aged 65 to 74 still have a mortgage, and that number continues to rise.

Why Are More Retirees Still Paying a Mortgage?

There are several reasons for this trend:· 

• Later home purchases or refinancing: Many retirees bought homes later in life or refinanced during low-interest periods, extending their loan terms into retirement.

• Rising home prices: Some moved to more expensive areas or upsized homes during their working years.· 

• Tapping equity: Others took out reverse mortgages or home equity loans to cover expenses like medical bills, renovations, or to help children with education or housing costs.· 

• Insufficient retirement savings: For some, staying in their home with a mortgage is more affordable than downsizing due to high rent and housing costs elsewhere.

What Are the Risks?

Carrying mortgage debt into retirement isn’t necessarily a bad thing, but it does come with financial considerations:· 

• Fixed income stress: Monthly mortgage payments can strain budgets that rely solely on Social Security or retirement accounts.· 

• Less flexibility: Mortgage obligations can limit freedom to travel, invest, or cover unexpected costs.· 

• ·Estate impact: Ongoing debt may reduce what retirees can leave behind for their heirs.

Emotional Considerations: The Hidden Side of Mortgage Debt in Retirement

For many retirees, carrying a mortgage into their golden years isn’t just a financial concern—it’s an emotional one. After decades of hard work, retirement is often seen as a time to enjoy freedom, security, and peace of mind. Yet the presence of a mortgage can stir up feelings of anxiety, uncertainty, and even guilt.

For some, the idea of not owning their home outright can feel like unfinished business. Others may feel conflicted about staying in a family home that holds cherished memories but is no longer practical—or affordable. The pressure to maintain mortgage payments on a fixed income can take a toll on one’s mental well-being and overall quality of life.

At the same time, there’s emotional comfort in staying in a familiar space. A mortgage might be a manageable trade-off for staying close to neighbors, routines, and a community you love. For others, letting go of that home and moving somewhere more affordable can open the door to less stress and more freedom.

🧠 Bottom line: Your housing decision isn’t just about numbers—it’s also about your emotional peace. That’s why it’s important to look at the full picture, not just your loan balance.

Smart Strategies for Retirees with Mortgages

Many retirees find themselves in the same position—and there are smart, practical ways to stay ahead.

Here are a few strategies to help manage or reduce mortgage debt while preserving your lifestyle and financial peace of mind. Partnering with a Seniors Real Estate Specialist® (SRES) means more than just expert guidance. It means working with someone who understands the emotional transitions that come with this stage of life—with knowledge, empathy, and care. Consider these options:

1. Downsizing Sell the current home and move to a smaller, more manageable property. This can free equity and reduce future mortgage and upkeep costs . If you're feeling uncertain about how to downsize the right way, be sure to check out this helpful read: Navigating Downsizing: Estate Sale or Donate?

   
   

2. Refinancing or Cash-Out Refi Lock in a lower interest rate or convert home equity into cash—just consider closing costs and long-term repayment .

   
   

3. Reverse Mortgages If you're 62+, a Home Equity Conversion Mortgage lets you tap home equity tax-free, with no monthly payments—though the loan balance grows over time 

   
   

4. HELOC Access equity as needed—flexible but be aware of variable rates and repayment requirements .

   
   

5. Enhanced Budgeting Consider part-time work, delaying Social Security, or paying off smaller debts to ease mortgage pressure

   
   

6. Estate Planning Plan to pay off any remaining mortgage before passing your estate to heirs, thoughtful if equity is tied up.

Local Market Trends: Aging & Downsizing in Solano & Contra Costa Counties

As the population ages, both Solano and Contra Costa Counties are seeing a significant shift in housing needs—especially among seniors looking to downsize or transition into retirement-friendly living.

Seniors in Solano County

Approximately 16.9% of Solano County residents are aged 65 or older—slightly above the national average of 16.8%. This share has been steadily rising over the past decade, highlighting a growing need for downsizing options, retirement housing, and senior services.

Contra Costa County at a Glance

In Contra Costa County, about 11.3% of the population is 65+, with nearly 260,000 residents aged 60 and above. This aging demographic represents a significant segment of the community—driving increased demand for age-appropriate housing solutions and services.

What This Means for Real Estate & Seniors

• Growing preference for smaller, low-maintenance homes with no stairs and easier upkeep

• Increasing interest in retirement communities, independent living, and assisted living facilities

• Higher need for local expertise—trusted REALTORS®, senior move managers, estate planners, and healthcare provider referrals

Whether you're planning ahead or helping a loved one, understanding these trends can guide better decisions—and working with a specialist who understands this stage of life makes all the difference.

Making the Move Smoother

If you’ve decided to move, take steps to make the process as stress-free as possible:

• Declutter gradually – Start by sorting one room at a time to avoid feeling overwhelmed.

• Enlist help – Family members or professional organizers in Solano County can assist with downsizing.

• Hire experienced movers – Look for moving companies that specialize in senior relocations to ensure a smooth transition.

How SF East Bay Homes Can Help

At SF East Bay Homes, we specialize in retirement transitions:

• Consultations: We’ll help you weigh all options—selling, refinancing, reverse mortgage, or staying put.

• Downsizing Assistance: From property prep and staging to connecting you with trusted estate planning, senior living, and moving professionals.

• Market Insight: With our East Bay expertise, we tailor local strategies to your financial goals—even on a fixed income.

 Next Steps

1. Schedule a free consultation with us to assess your mortgage and retirement goals.

2. Get connected to our trusted network—financial planners, senior living advisors, and more.

3. Build a customized transition plan that fits your lifestyle and financial comfort.

If you're considering a move or need guidance on your next steps, reach out to SF East Bay Homes today. We're here to help you navigate this transition with confidence, dignity, and peace of mind.

The Bottom Line

There’s no one-size-fits-all solution. While some retirees thrive with a mortgage, others may benefit from restructuring or letting go of their current home. What matters most is creating a housing plan that supports both financial health and personal well-being.

Have questions about downsizing, refinancing, or exploring better living options in retirement? I’d be happy to help you explore what’s right for your future. Follow us on Facebook and Instagram for more guidance for real estate and navigating these transitional times for your loved one.

Unlocking a Healthier, Happier Retirement

As more adults in Solano and Contra Costa counties embrace the next chapter—downsizing, simplifying, and planning ahead—mental clarity and well-being become just as important as financial preparedness.

🧠Feel your best, live your fullest — at every stage of life.

Join Allison Costelow, Seniors Real Estate Specialist in Benicia, along with special guest Eric Freitag, PsyD, ABN—President & Founder of We Care Senior Living Advisors—for a free, relaxed 30-minute online seminar: “Clarity In Your Retirement Years: The 5 Pillars To Keeping Your Mind Sharp”

🗓️ June 25 | 6 PM PST

We’ll explore practical, uplifting ways to support your health, memory, and mindset in retirement—without the overwhelm. Whether you're preparing for the future or already navigating this stage, this session offers the clarity and confidence you deserve.

Spots are free—reserve yours today:👉 Register here