Reverse Mortgage Scams and Other Fraud Targeted at Seniors

Reverse mortgage scams are just one type of fraud being targeted at seniors. Check out the following description of two common scams to watch out for.

Reverse Loans

Reverse mortgage scams may involve real estate agents or other financial services workers. In some cases seniors are offered free homes to live in, but they are really being used as straw buyers. Once the home is purchased, the scammer uses a reverse mortgage to strip the home of its equity. Other reverse loan scams may occur when someone offers to help a homeowner avoid foreclosure, but gets away with the proceeds from the mortgage. Also keep in mind that anytime you apply for a reverse home mortgage you must receive counseling from a HUD-approved agency.

Grandchildren in Distress

The grandchild scam has been making the rounds to prey on older folks. Be skeptical of phone calls from someone who says they are your grandchild — especially if they don’t say their name –and claims to need money because they were arrested or in an accident. Some calls may involve people who claim to be the police or an attorney. The caller usually pleads with you not to tell their parents and ask that you wire thousands of dollars to help them out. If you receive this type of call, don’t reveal your grandchild’s name or other information. Instead, try to verify the person’s identity by asking questions that only he or she might know, or calling them or their parents.

Whether it’s reverse mortgages, insurance, or other financial products always use caution when choosing who to do business with. Avoid signing up for products and services with people who knock on your door, call, or email you out of the blue. Finally, never reveal personal information if you aren’t sure who you are speaking with.

This entry was posted on Monday, March 22nd, 2010 at 7:14 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.