Avoid Reverse Mortgage Scams

Foreclosure Rescue Fraud

Scam artists also prey upon seniors who are scared they may soon fall behind on their mortgage payments or face foreclosure. How do these scams usually begin?

1. The scammers suggest the victim make costly repairs on their property.
2. The scammer gives the victims money so they won’t lose their home.
3. Using a dishonest appraiser, the scammer artificially inflates the value of the seniors’ home and suggests they take out a reverse mortgage.

“C” is correct. Once the mortgage is approved, the property title is transferred to the scammer, leaving the victims without a home or reverse mortgage funds. Scammers also may work with a phony financial institution that tells the owners they don’t qualify for a reverse mortgage, but can take out a different loan instead. During the loan closing, the property title is transferred to the scammers.