Not only is 96% of mortgage debt in the U.S. fixed rate, but 38.5% of homeowners don't have a mortgage at all.
40% of Americans Pay Off Their House — Are They Doing Better Financially? For most Americans, a home mortgage is the biggest financial obligation they will ever have. A traditional mortgage spans 30 years and is often in the hundreds of thousands of dollars, so the interest charges can be enormous.
28% of Brits own their home outright, whilst 25% have a mortgage.
New York (54.3%), California (55.3%), and Hawaii (61.3%) have the three lowest rates of homeownership among states.
The survey found that 63% of Americans can't afford to buy a home this year, with 87% of Gen Z unable to and 62% of millennials unable to. Given the housing market, 1 in 4 surveyed no longer believe that homeownership is a good investment in the long run, and 1 in 3 don't believe it should still be the American dream.
About 27.8% of 24-year-old Gen Zers are homeowners compared to 24.5% of millennials when they were the same age.
Today, the average first-time buyer isn't expected to be mortgage-free until they are 63 years and 8 months old. However, in London, this surpasses the current retirement age at 66 years, 8 months. The average mortgage term that a first-time buyer chooses is 30 years.
Average Household Debt by Category
As of March 2023, average total UK household debt excluding mortgages was around £15,501—an increase of 79% over ten years. Credit card debt is up 6.5% in the ten years to 2024, having reached an all-time high of £2,662 per household five years ago.
UK savings statistics: Highlights
68% of Brits have some money in savings in 2024. However, almost half of Brits (46%) have £1,000 or less in savings, and a quarter of Brits (25%) have £200 or less. 1 in 6 UK adults (16%) have no savings at all, equating to around 8.7 million people.
"Shark Tank" investor Kevin O'Leary has said the ideal age to be debt-free is 45, especially if you want to retire by age 60. Being debt-free — including paying off your mortgage — by your mid-40s puts you on the early path toward success, O'Leary argued.
With roughly 84 million mortgages active in the U.S., according to data from LendingTree, that would mean about 1,092,000 Americans are more than 60 days past due on their mortgages.
Those with billions of dollars to their name can buy a home outright rather than take out a loan. Yet celebrities like Mark Zuckerberg, Elon Musk and Jay-Z have all made headlines for taking out multimillion-dollar mortgages — not out of necessity but to reap a couple of key benefits.
That breaks down into $241,815 on average in mortgage debt, and an average of $23,317 in non-mortgage debt (including credit card, student loan, auto loan and personal loan debt). But these debt balances vary greatly depending on age group.
An unmortgaged home was once a retirement perk
Mark Iwry, nonresident senior fellow at the Brookings Institution. But that pattern is changing. In the Michigan study, researchers found that the share of retirement-age homeowners with mortgages rose from 38% to 51% in a generational span of about 25 years.
27% of U.S. adults have no emergency savings, as of May 2024 polling — the highest percentage since 2020. People are working hard on their finances.
How many people need debt advice? In 2023, 15% of the UK adult population fell into this category, equivalent to 8.1 million people. Most people in the UK, 61% of the population – or 32.5 million people – don't need debt advice.
Should you pay off debt before buying a house? Not necessarily, but you can expect lenders to take into consideration how much debt you have and what kind it is. Considering a solution that might reduce your payments or lower your interest rate could improve your chances of getting the home loan you want.
Absolutely. The Equal Credit Opportunity Act's protections extend to your mortgage term. Mortgage lenders can't deny you a specific loan term on the basis of age.
One of the most significant benefits of paying off your mortgage is the peace of mind that comes with owning your home outright. Without a mortgage, you don't have to worry about monthly payments, which can be especially comforting in retirement or during economic downturns.
In short, all that matters is that you can afford the repayments. There is not a set wage you need to earn to get a mortgage. If you can prove that you'll be able to repay your mortgage long term, your income shouldn't stop you getting a mortgage.
Baby boomers have the highest net worth, averaging $1.6 million per household. Baby boomers have the highest household net worth of any US generation.
Boomers own 38% of America's homes—but more than half never plan to sell.