August 27, 2009…Senior Citizen Alert. The Wall Street Journal reported today on page D 1 that a new scam on senior citizens involves “reverse” mortgages.
“[R]egulators and law-enforcement officials are sounding alarms about the potential for yet another type of mortgage fraud – this time, in the small but fast growing reverse- mortgage market. Such fraud, though still rare, ‘is occurring in every region of the United States and reverse-mortgage schemes have the potential to increase substantially,’ according to a recent publication issued by the Federal Bureau of Investigation and the Office of Inspector General at the U.S. Department of Housing and Urban Development, which oversees the federally insured loans that account for some 99% of the reverse-mortgage market.”
According to the article, regulators cite cases in which real estate speculators have purchased properties at distressed prices, then have sold them using inflated appraisals to senior citizens willing to take out reverse mortgages. While these types of scams are “around the edges” of an otherwise legitimate market, seniors need to be aware.
Post By:
John R. Hargrove
Hargrove Pierson & Brown
“A Boca Raton Law Firm”
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