Beware of Reverse Mortgage Fraud, What You Need to Know Now
By Kevin Reichard
Let’s discuss something that has been in question more and more by seniors I am visiting…the notion that the FHA Reverse Mortage is a fraudulent product designed to steal homes.
While we all know that the protections in place do prevent a large amount of fraudulent activity, examination of what is ‘possible’ is something that I believe all loan originators should be sharing with their customers – to reveal to them what others are not, and to set themselves apart by being the one who does point out the possibilities.
From what I can tell, there are three main ways that seniors are being scammed, having the reverse mortgage they have taken, in some cases inadvertently enabling others to take advantage of them.
The loan originator influences the borrower as to what to do with their money. The most obvious is the pushing of other insurance products to be bought with the proceeds of the loan. The example I use is that the Originator has a sidekick, who is able to provide you, the borrower, with a product that MUST be purchased in order to qualify for a reverse mortgage. Post sale purchases are also popular among these scumbags.
The kids- the jerkball adult kids takes over control by becoming for the Power of Atty for the senior. Then they do a reverse mortgage, and sadly, whatever they want to do with the money….there was recent example of this in the news, as unreal as it sounds, it is indeed true.
Lastly, I actually had an adult child pose this to me: “So, if my mother passes and I move in and respond to the bank as if she were alive, I could keep getting the checks?”
Yes, sweetheart, you certainly COULD……but that would make you a felon!
Now, we have covered some other shenanigans that need further inspection, such as Loan originators paying for appraisals, forging documents, etc…
In order to keep the industry clean, I suggest that you don’t stand by when you hear of these abuses, report them! And EDUCATE your seniors what to be careful of out there! If you don’t earn their business, make sure someone else does!
Kevin Reichard-
Kevin’s resume includes a current position teaching the Reverse Mortgage Class at Gold Coast Mortgage School located in South Florida. Working exclusively in the reverse industry, Kevin has trained dozens of reverse mortgage loan originators as well. He has become the South Florida professional community’s first choice for accurate and timely reverse mortgage information. Kevin’s passion for helping seniors is unmatched. Now operating his own reverse mortgage company in Coral Springs, Kevin continues to happily help seniors and their families every day. For up to date reverse reverse mortgage information, visit http://www.thereversemortgageschool.com/
Photo by Leon Mitchell
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