Watch Out For Reverse Mortgage Scams, Says Florida AG

From the Office of the Florida Attorney General:

• Attorney General Bill McCollum [yesterday] issued a consumer advisory warning Florida’s senior citizens about a mortgage-related scam that may target them directly. As he unveiled legislation this week to combat mortgage “foreclosure rescue” scams, the Attorney General also cautioned senior citizens about scams associated with reverse mortgages, a type of home equity loan frequently abused by con artists and scammers. These loans are often popular options for senior citizens because they offer a cash source which can help meet unexpected medical expenses, supplement social security and more.

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• Unfortunately, as the popularity of reverse mortgages grows, so does the potential for fraud. Predatory lenders, unscrupulous loan agents and dishonest brokers may target senior citizens who may be anxious about their financial security. Deceptive practices and allegations of high-pressure sales tactics are being more frequently encountered as senior citizens are being taken advantage of under the guise of a helpful and legitimate reverse mortgage. Borrowers also run the risk of being steered into inappropriate loans and annuities by sales agents and insurance brokers who could be working together without disclosing that relationship to the borrower. Attorney General McCollum noted that reverse mortgages can serve a purpose when financed through legitimate lenders.

For more, see Florida AG News Release: Seniors Should be Wary of Reverse Mortgages Scams.

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