Reverse Mortgages are becoming popular in America. Reverse mortgages are a special type of home loan that lets homeowners covert the equity in his/her home into cash.
If you are interested in a reverse mortgage, beware of scam artists. Call today to speak with one of our trained Reverse Mortgage Counselors.
How the Scam Works
Being charged for reverse mortgage information
Do not pay for any type of reverse mortgage information, brochure, or calculations of what you can qualify for.
Reverse Mortgage Counselors with hidden agendas
Another wonderful protection feature for seniors is the requirement for the borrower(s) to have an appointment with a HUD approved Reverse Mortgage Counselor, like LSS. A counselor should never partner with other reverse mortgage lenders or financial service individuals nor should they try to push you into their products or services. If this happens to you, report it to HUD immediately, also inform the company/lender you are working with to also report it.
Reverse mortgage foreclosure flipping
The scheme begins with an investor buying a foreclosed home for below market value. The "investor" then arranges for a bogus sale of the home to a senior who immediately takes out a reverse mortgage at an inflated value. The senior pays back the investor and owns a home that they have paid nothing for.
Reverse mortgage repair scams
Due to a strict FHA appraisal, a Reverse Mortgage may require repairs made to the property before you can close on your reverse mortgage. Make sure you find exactly what needs to be repaired by the appraiser. Here is what you need to watch out for. Some companies will also offer home improvements or repairs through a recommended contractor. Most likely, the contractor is aware of the scam and charging exorbitant prices for his or her services.
To report fraud or abuse in the reverse mortgage program, contact your local homeownership center.