Reverse Mortgages & Senior Protection
December 9th, 2007
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California has an interesting law on the books which would be useful in all states.
Just as doctors and hospitals are required to report suspected cases of child abuse, under California’s Financial Elder Abuse Reporting Act of 2005, bank, savings and loan, and credit union employees who suspect elder financial abuse are required to immediately notify Adult Protective Services or law enforcement authorities.
Is this a good idea? No one wants to see someone with diminished capacity taken advantage of and there ought to be a system in place to watch out for older citizens. Alternatively, we don’t want a system which is merely intrusive when senior citizens make choices with which we merely disagree.
In terms of reverse mortgages, the California law may well give older homeowners protections which are outside the lending system, per se. Ethical lenders will have no problems with the law, while cheats may be impacted.
The California law raises interesting ideas and is at least worthy of discussion in other states. Speak with your state representatives for additional information and advice in your jurisdiction.
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December 9th, 2007 at 11:48 pm
Yes, this reporting Act will surely help a few but I believe the far more frequent and dangerous result will be forced conservatorships when the bank calls Adult Protective Services and a public guardian or private conservator will be appointed to take over the elder’s life and assets. And these persons will be lost in the crowd as there will be no publishing of these statistics. If a family member tries to intercede, the elder’s money will be used against the family member.
December 10th, 2007 at 2:20 am
Terri –
Thanks for your note.
You make a very important point. The idea is that there should be some balance and what you mention can surely happen when the system errs too much in the wrong direction.
In my experience I have seen seniors who were the brightest people in the room, but also cases where individuals did not have sufficient capacity to make their own decisions. The first group I’m not worried about and the second plainly needs assistance. It’s the folks in the middle who may need help and may also lead to the unnecessary conservatorships that you mention.
Please continue to post with us.