No one is safe from becoming a victim of Mortgage Fraud, especially the elderly. Senior homeowners are often prime targets as scammers prey on their vulnerability. Seniors may suffer from memory loss and illness. They are less likely to report fraud and are perceived as having a nest egg worth cracking. (Source FBI.gov). Victims lose more than money – they lose confidence and lose time trying to recover from their losses.
Beware of These Common Tactics of Fraudsters
The fraudster, who could be a real estate or financial services professional, often initiates a scam that is masked as the legitimate Home Equity Conversion Mortgage (HECM) or Reverse Mortgage – but ends with the homeowner losing it all.
For example, a scammer reaches out to seniors through a church group, investment seminar, or other means, and then convinces the elderly homeowner to give them power of attorney to take out a reverse mortgage. The homeowner thinks he or she is paying into an investment opportunity. Eventually, the scammer will make off with the cash leaving the homeowner, or their family members, with a large debt and insurance fees. (Source: NCPC.org)
Only 61% of respondents always read contracts carefully before signing, according to a NCPC Survey. That leaves 39% of respondents at greater risk of becoming victims of Mortgage Fraud. Seniors are particularly at risk.
Have you or someone you know fallen victim to a mortgage scheme? NCPC urges the following steps to protect yourself from further problems:
Step 1. Contact your mortgage servicer/lender immediately to work on managing the impact of the fraud.
Step 2. Speak with a HUD-approved housing counselor to obtain free homeownership education and counseling services.
Step 3. Report the mortgage fraud to the appropriate authorities such as the Federal Trade Commission or the Consumer Financial Protection Bureau.
Tools and information to help you avoid scams, get prevention resources, and find help if you or someone you know has already fallen victim are available in a free Mortgage Fraud Online Toolkit.
Source NCPC.org
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