There is a report published by Kiplinger this week that warns seniors that reverse mortgage abuse is on the rise. The issues that are raised in the report are very important issues which should be of concern to seniors who are considering getting a reverse mortgage loan. However, it is not necessarily accurate to say that predatory lending practices are actually increasing at the current time.
Reverse mortgage abuse is definitely an issue that should be focused on by people who are working with seniors. There are predatory lenders out there who market aggressively to get seniors to obtain a reverse mortgage loan which may not be right for them. The suggestion of the article is that the rise in the number of mortgage companies offering these loans combined with the rise in the number of people approaching the age when a reverse mortgage can be obtained leaves the door open for additional predatory lending practices to take place.
It is true that the door may be opened but it should be noted that there are people guarding that door carefully to make sure that reverse mortgage loans are safe for seniors. The FBI has cracked down on aggresive reverse mortgage marketing and reverse mortgage fraud in recent months. Additionally, reverse mortgage counseling has been improved and state legislators have passed laws to protect these borrowers. While it remains important to be aware of these reverse mortgage issues, it is not necessarily a time for panic in the industry.
Question of the Day: Is reverse mortgage abuse on the rise?
