In recent commercials on TV, Henry Winkler is promoting reverse mortgages, telling people they can continue to live in their homes without worry. Reverse mortgages permit homeowners 62 and older to borrow against the equity in their homes, and not repay the loan until they move or die. Homeowners still have to pay insurance, maintenance, and property taxes. According to The New York Times, although the number of these loans has declined (currently numbering around 775,000), regulators are uncovering abuse that has increased from two percent of reverse mortgages ten years ago to 9.4 percent recently. The Consumer Financial Protection Bureau (CFPB) has learned of some solicitations that offer free money, or falsely tell applicants they can never lose their home. Aggressive brokers earn more money if the older spouse is the only name on the loan. As MHProNews has learned, if that person dies, the surviving spouse has to buy the home outright or leave.
(Image credit: SeniorEquityFinancial)