House Refinance Center
HOME       MORTGAGES       BREAKING NEWS       FORECLOSURES       GOOD FAITH ESTIMATE       HOUSING COUNSELING       LOAN MODIFICATION       VIDEOS       SLIDESHOWSR
calculators          zero down mortgage          second mortgage          mortgage interest deduction          mortgage servicing          first time buyer          financial reform          fannie and freddie
FHA       mortgage approval        nonprofit brokers       servicemembers       stated income          refinance calculator       downpayment        closing fees         bank owned (REO)
title insurance       buying a home       refinance with ARM        appraisal inspection       community banks       good faith estimate           FHA streamline 203k           breaking news
Home          Credit          Foreclosure          Refinance          Hard money          Interest only mortgage          Loan modification          Shortsale          Reverse mortgage          Strategic default
Reverse Mortgage Scams
Avoid Reverse Mortgage Scams

Many homeowners seeking a reverse mortgage are old and retired. They are prime targets for
criminals whose objective is to take the hard earned money from American citizens. To protect
yourself from the numerous scams dreamed up everyday follow these simple guidelines.

* Reverse mortgages are not a one size fits all. Consult with an independent financial advisor
to find out what reverse mortgage package best suits your financial situation and needs.

* If you do not have a financial advisor, discuss your situation with a counselor approved by the
US Department of Housing & Urban Development (HUD). HUD-approved you with your
reverse mortgage questions. They are free. You can call 1-800-569-4287 to find a counselor in
your area.

* Once you decide on a lender, ask for an itemized list of the fees. Make sure you understand
all the costs and fees associated with the reverse mortgage.

* Find out whether the reverse mortgage you are considering is federally-insured.  This will
protect you when the loan comes due.

* Find out whether your repayment obligation is limited to the value of your home at the time the
loan becomes due.

* Make sure any reverse mortgage payments are first made directly to you; do not allow
anyone to persuade you to sign over the funds to someone else.

* Do not invest your money. Put it in a savings account until you are 100% sure what you want
to do. Be wary of anyone who tries to pressure you into a decision that you are not completely
comfortable with, such as investing the payments from your reverse mortgage into an annuity,
insurance policy, or other investment product, or pressuring you into receiving a lump-sum
payment over monthly payments.

* If you are uncomfortable with the reverse mortgage that you entered into, exercise your right
of rescission within three days of the closing.  A right of rescission allows you to cancel the
mortgage within three days of closing without penalty.
Red Flags Of
Reverse Mortgage

Fees

There are excessive loan fees

Deferred annuity

Do not use the money for a deferred annuity. It
provides high commissions to the sales reps. The
annuity ties up money far beyond the life
expectancy of the senior. The annuity also has high
surrender fees if you need to cash it early.

Government benefits

You might lose some government benefits. If you
get a lump sum and do not spend it immediately.
The government might take it as an asset, and this
could affect certain benefits. In addition, after the
money is spent, it might take a long time to have
the benefits reinstated by the government. If you
are receiving Medicaid ask your counselor to
explain how the reverse mortgage affects Medicaid.