Reverse mortgages, also known as home equity conversion mortgages(HECM), have increased more than 1,300 percent between 1999 and 2008, creating significant opportunities for fraud perpetrators.
In many of the reported scams, victim seniors are offered free homes, investment opportunities, and foreclosure or refinance assistance. They are also used as straw buyers in property flipping scams. Seniors are frequently targeted through local churches and investment seminars, as well as television, radio, billboard, and mailer advertisements.
Tips for Avoiding Reverse Mortgage Scams:
- Do not respond to unsolicited advertisements.
- Be suspicious of anyone claiming that you can own a home with no down payment.
- Do not sign anything that you do not fully understand.
- Do not accept payment from individuals for a home you did not purchase.
- Seek out your own reverse mortgage counselor.
Read our intelligence bulletin on reverse mortgages.
Additional Resources on Frauds Impacting Seniors:
- USA.gov Resources for Seniors
- Resources from the United States Senate Special Committee on Aging