The news has been buzzing lately with warnings that the government is cracking down on reverse mortgage fraud in an effort to keep seniors safe from predatory lenders. Just take a scan back through our headlines here over the past few weeks and you'll see that everyone from the FBI to our United States senators are involved in this effort. And bad reverse mortgage companies are starting to see the impact.
For example, a New York company that had been sending out misleading advertisements about reverse mortgage loans to vulnerable seniors has just been fined by the state's Attorney General. The business was found guilty of trying to act like a non-profit organization when it's obviously in the business of making money. They promoted the reverse mortgage loan as a "tax-free government program" ... and failed to explain the details of the loan in their ads.
This type of advertising is problematic because it puts seniors at risk. The seniors who are unhappy with their reverse mortgage loans are almost always the seniors who didn't understand what the loan was all about which is precisely what happens in cases of this kind of advertising. By cracking down on this, authorities hope to make it so that individuals who use their reverse mortgage loan options do so with complete understanding of what the loan is all about.
Learn more about the NY case here.
Question of the Day: Are you happy to see that authorities are cracking down on bad reverse mortgage lending?
