Mortgage Reverse Scams - What To Look For
These products are often considered a beneficial and viable option for seniors to access cash on their home without having to worry about monthly loan repayment plans.
Unfortunately, as with many other services, there have been reports of scams for these types of services. Knowing what to look for may help protect your parent's property and educate both seniors and their caregivers regarding reverse mortgage services.
Mortgage reverse are a type of home loan that enables seniors over 62 years of age or older to convert equity in their home into cash. The loan doesn't need to be paid back as long as the property owner lives in the home. Funds made available through reverse mortgages help many seniors to supplement their social security income, take care of unplanned medical costs and expenses, make improvements to their home, or even take that always dreamed about vacation.
Some of the most popular attractions to the mortgage reverse are that they don't require income qualifications, the homeowner retains title to the home, and no payments are required on the loan until the property is sold, the homeowner dies, or moves out.
As the old saying goes, " if it's too good to be true", it often is. Seniors as well as their caregivers, family members and friends should know some of the most common scams associated with mortgage reverse offers. Some of the most common include:
You may also call HUD at (888) 466-3487. Any company, individual or organization who state that they're estate planners or financial advisers and charge a nominal fee for advice or information regarding a mortgage reverse should be reported to HUD.
Because seniors are often prime targets for scam artists and unscrupulous lenders, seniors need to be especially careful when it comes to reverse mortgages. Seniors should be educated and well versed on the terminology and basic structure of a reverse mortgages, and take advantage of HUD approved counseling services.
Seniors and any caregivers involved in the financial decisions of parents or loved ones should always make sure they know who they're dealing with and the organization they claim to represent.
Ask for identification, their home office location and contact information and verify that the individual you're talking to is who he or she says they are. You may also access HUD-approved law or the National Reverse Mortgage Lenders Association to verify company backgrounds.