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From: God'sLittleAnus on 25 Oct 2009 11:42
This supposed "government" program is in reality a SCAM, a SNARE, set
up to steal seniors' homes and money!
"Beware of Reverse Mortgages"
October 25, 2009
Increasingly, strapped U.S. homeowners are opting to take out a
reverse mortgage, a loan against a houses value that is repaid when
the borrower dies or sells the property. The number of federally
insured reverse mortgages issued to senior citizens in the past three
years alonenearly 335,000is more than the total from 1990 through
2006. Consumer advocates have long cautioned that reverse mortgages
should be used as a last resort because of their high fees. Now, those
warnings are growing louder due to a spate of fraud.
The National Consumer Law Center says seniors are facing the same kind
of aggressive tactics that were common during the subprime lending
boom. And according to a recent report from the FBI and the U.S.
Department of Housing and Urban Development (HUD), a host of
unscrupulous loan officers, mortgage companies, and loan counselors
are defrauding desperate Americans. In one scheme, people facing
foreclosure are told that a reverse mortgage can save their homes,
then rejected for the mortgage and steered into a deal that
transfers title of their property to investors. The end result:
They lose their homes anyway.
Other scam artists sell loans that appear to be HUD-insured reverse
mortgages but are not, according to the AARP, the nonprofit advocacy
group for Americans 50 and over. Still others, billing themselves as
investment advisers, persuade consumers to invest the proceeds of
reverse mortgages in other financial products that come saddled with
extra costs. And in some cases, the FBI report says, the proceeds of
investment schemes are not investedtheyre simply stolen.
Homeowners should turn down any pitch that uses reverse-mortgage funds
to purchase financial products. In fact, they should think twice
before signing up for this type of loan at all. Other optionslike
taking a home-equity line of credit or even moving to a smaller place
may be able to meet your needs at a lower cost, according to the AARP.