Latest Scam Targeting Reverse Loan Borrowers

There have been many reports about seniors being targeted for fraud involving reverse mortgages. Two common cons involve stripping home equity or getting seniors to act as straw buyers. A recent scam that has emerged involves “reconveyance deeds,” according to a Senior Journal article.

Was Mortgage Paid Off?

A reconveyance deed is a document that proves that a mortgage has been paid in full. The public document must be filed in the county where a property is located. Without this document there could be problems with the title to a property. Because this document is filed publicly, anyone can get access to it.

Reverse Mortgage Borrowers

The Senior Journal article says it isn’t clear whether only reverse loan borrowers are being targeted, but apparently most of the complaints came from borrowers aged 62 and up. The letters sent to them claimed that the deed of reconveyance was never filed and that for a fee of $140 to $175, the scammer’s company would file it for them. The letters usually urged homeowners to respond within 30 days and emphasized that this would be their only notice.

Verify All Documents

As with any solicitation that seems questionable or shady, it’s always best to avoid reacting in a panic. Homeowners with or without reverse home mortgages should never send money to any company or individual who appears out of the blue demanding payments. Instead of blindly sending money, it’s best to look through your personal records to see if you have this document. If you cannot find this information, check with your county clerk or title company to see if the reconveyance deed was in fact filed correctly. Finally, anytime you believe that you are the target of a scam, contact your state’s attorney general to report it.

This entry was posted on Tuesday, July 6th, 2010 at 5:30 pm and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.