About Us | Contact Us
View Cart

Reverse Mortgage Scams

By Dan Hadaway | Tuesday, July 14, 2009 - Leave a Comment

The FBI and the U.S. Department of Housing and Urban Development Office of Inspector General (HUD-OIG) urge consumers, especially senior citizens, to be vigilant when seeking reverse mortgage products. Reverse mortgages, also known as Home Equity Conversion Mortgages (HECM), have increased more than 1,300 percent between 1999 and 2008, creating significant opportunities for fraud perpetrators.

Reverse mortgage scams are engineered by unscrupulous professionals in a multitude of real estate, financial services, and related entities to steal the equity from the property of unsuspecting senior citizens aged 62 or older or to use these seniors to unwittingly aid the fraudsters in stealing equity from a flipped property.

In many of the reported scams, victim seniors are offered free homes, investment opportunities, and foreclosure or refinance assistance; they are also used as straw buyers in property flipping scams.

Seniors are frequently targeted for this fraud through local churches, investment seminars, and television, radio, billboard, and mailer advertisements.

A legitimate HECM loan product is insured by the Federal Housing Authority (FHA). It enables eligible homeowners to access the equity in their homes by providing funds without incurring a monthly payment. Eligible borrowers must be 62 years or older who occupy their property as their primary residence and who own their property or have a small mortgage balance.

Seniors should consider the following:

    • Do not respond to unsolicited advertisements.

 

    • Be suspicious of anyone claiming that you can own a home with no down payment.

 

    • Do not sign anything that you do not fully understand.

 

    • Do not accept payment from individuals for a home you did not purchase.

 

  • Seek out your own reverse mortgage counselor.

If you are a victim of this type of fraud and want to file a complaint, please submit information through the electronic tip line or through your local FBI office. You may also file a complaint with HUD-OIG or by calling HUD’s Hotline at 1-800-347-3735.


 

Latest News
    Another awareness poster for YOUR customers (and users).  Now that we have our own employees aware, maybe it’s time to start posting content for our customers! Download the large versions here: Awareness Poster (Portrait) Awareness Poster (Landscape)   You are welcome to print out and distribute this around your office.  
    A Webinar-Movie In our current world of uncertainty there is at least one thing that is certain. Business needs to continue, and that means that it is important for managers to be able to meet with their team even if everyone is working remotely at this point. In this Webinar-Movie, Dan will compare virtual meeting […]
    The One Test… …Is there a Test that Covers 9/11’s of the Battle? Another one of those Dan’s New Leaf Posts, meant to inspire thought about IT Governance . . . . Twenty years ago two geek-friends and I debated the following question:  “Is there an Audit Test that covers 9/11’s of the battle?” This […]
    PRESS RELEASE – FOR IMMEDIATE RELEASE BUSINESS NEWS NEW EMPLOYEE FOR INFOTEX infotex has just hired Tanvee Dhir, to be a new Data Security Analyst. “Tanvee is an outstanding addition to the team, bringing a new skillset we are eager to utilize.” says Chad Smith, NOC Manager of infotex. “I am really excited to be […]
    While we’re not a news service, we often use current events to comment on trends and our services. This blog is intended to get people thinking about topics and trends in Technology Risk Management, through our article reviews, as well as through original blog articles about current events and our MSSP services (such as our […]