There are innumerous problems that affect the homeowners and that which hinder the progress in real estate scenario. Particularly when it comes to disposal of a house, there are innumerous hassles that come along the way. But, that alone is not the problem in the housing market. There is a scam on the forefront that is targeted at seniors who are in possession of a house.
There is a drastic increase in the number of reverse mortgages and this has resulted in related scams which target the homeowners. When comparing with other scammers, reverse mortgage scammers perpetrate much harm and cause huge loss to the homeowners. They pose as financial consultants or lenders and get off with the hard earned money of the elderly folks. The financial product that they furnish is difficult even for well-educated to understand. For those who are demented through age, it is still more a complicated scamming process to make out.
In several scenarios reverse mortgages are a viable option. But, there are several other reasons for reverse mortgages to turn against you. There are some reverse mortgage scams which you should be aware of.
Con artists posing as vendors and contractors:
In this type of scam, nefarious criminals posing as vendors and contractors make use of the elderly, who in turn become the victims of the scam. The conmen project a scheme that furnishes information about selling repairs and refurbishing of the home. As the targeted individual shows interest in forwarding the payment, the scammers come up with a solution in the form of reverse mortgage. It is, of course, a wonderful option for them to receive payment. But, it does not work in favor of the homeowner.
You might desire to make amends to your home, but you may not have a suitable source of income. Then, the home-equity loan comes to your aid. If a vendor or contractor says that the payment is made through a reverse mortgage, then he is not the right person for you. They would not be able to give you quality work.
Relatives or financial advisors who involve in frauds:
It is very similar to the vendor and contractor fraud. They will come up with a financial product that you really do not require and they would demand that you avail of a reverse mortgage. When a person comes up with such an option, it is usually not in your favor.
Be very diligent when you forward the power of attorney. The document makes it easy for the one holding it to carry out financial transactions which are inclusive of acquiring a reverse mortgage on the property. Senior citizens often become victims of the reverse mortgage scams.
The fraud which comes in the form of flipping:
In this type of scam, the make-believe realtors look out for seniors and force them to get a reverse mortgage for the purchase of a house at an economic price. Here, the victim does not have to put down any money. As bad luck would have it, these houses which look good are in fact with innumerous flaws.
Sometimes the authorities enforcing the law fail to catch such culprits red-handed. Thus, these con-artists move across places or stay rooted in one place committing a number of frauds. Be careful of these people who lay the bait in the form of reverse mortgage.
Now that you are aware of the reverse mortgage scam techniques that con artists follow, make sure that you contemplate on details that will drag you to become a victim and play safe.
For further details on reverse mortgage scams, read Zack Childress articles and you can be sure of getting into scam-free real estate transactions.