Reverse Mortgages: A Cautionary Tale
Reverse Mortgages: A Cautionary Tale
While there is already enough to worry about when it comes to weighing the pros and cons of reverse mortgages, seniors also have to be wary of reverse mortgage scams. These scams target seniors who need financial assistance to cover their living expenses.
The Pros and Cons of Reverse Mortgages
What is a Reverse Mortgage?
A reserve mortgage allows seniors to borrow money against the equity in their home, whether they have the majority or all of it paid off. Interest accumulates over time, and the loan doesn’t need to be paid off until the homeowner sells or passes away. Then, any interest is added to the loan's balance.
Types of Reverse Mortgage Scams
Illegal Information Fees
Scammers will charge a “fee” just for providing information about their reverse mortgage products.
Property Title Transfer
Seniors are convinced to transfer the property title to scammers as they think they will assist with the reverse mortgage process.
Document Fraud
Scammers will pretend to be from a financial institution and request that seniors send documents and money to help with the approval process.
If you suspect fraud or have been the victim of a fraud, report it to your local police service and the Canadian Anti-Fraud Centre online at: www.antifraudcenter.ca or by calling: 1-888-495-8501. You should also contact your bank and credit card company if you believe your personal or financial information has been compromised.
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