As we get older, there are many things we have to maintain in our lives in addition to good health. Seniors are exposed to potential scams and fraud every day and knowing how to recognize the red flags is important. As you make yourself more familiar with your reverse mortgage, here are a few scams we want to share with you to keep your finances in good shape.
- Move into a Free Property
There are professional con-artists out there that are advertising free homes to seniors when applying for a reverse mortgage. As the fraudsters keep the money that is being paid every month by the customer for the reverse mortgage, the senior is asked to only pay the insurance and property taxes. The way that the scammers make this happen is they falsify the reverse mortgage on an inflated appraised property value. After the customer moves or passes away, the lender is held responsible for the reverse mortgage because the value of the property is inaccurate.
- Equity Scams
This typically happens when a few people purchase a distressed piece of property or a foreclosed home. After obtaining an inflated appraisal, they ask a senior to buy the home and apply for a reverse mortgage. A settlement attorney also works with these scam artists to use funds from the mortgage at the time of the settlement which results in the senior having minimal or no equity in their property.
- Requests for Information
Con artists have been known to mail letters to seniors with falsified loan documents which includes a “Reconveyance Deed”. In the letter it asks the senior to send money to provide them a copy of the deed for their mortgage lender. In some cases, the customers are charged thousands of dollars for information about their reverse mortgage although this information is free from the Department of Housing and Urban Development (HUD).
Find out more about reverse mortgage scams by giving us a call today at 1-866-638-5030.
Tags: Reverse Mortgage Scams