| Seniors 100% At Risk Getting a Reverse Mortgage without Professional Financial Advice |
If you have a FINANCIAL FREEDOM REVERSE MORTGAGE or know anyone who does please have them contact me immediately at 805 402-3066 or sandy@elderfinancialterrorism.com The Government defines a Reverse Mortgage as a “COMPLEX FINANCIAL TRANSACTION” in the required disclosure in every reverse mortgage contract called “Important Notice”. If you understand this IS the definition and follow the instructions and information in the “Important Notice” this is what will happen: You would get professional, competent, independent financial and/or legal advice to understand this complex financial transaction, the binding legal documents, the important financial and legal implications, the terms and their (lifelong) effect and would be able to make a conscious and informed decision on the suitability of a reverse mortgage to meet your retirement goals for your financial security. Below is the link to the Important Notice in my parents loan application. IMPORTANT NOTICE There is only ONE REASON/PURPOSE to get a reverse mortgage: For use as part of your financial strategy, to meet your financial goals (long term), and provide financial security through your retirement. If a reverse mortgage does not meet this purpose do not get it. TIP: Explore all your homeowner options before making a decision: Lease you Home Sell your Home Refinance your current mortgage Get a Line of Credit Family Loan Rent a portion of your Home Once you explore all your options choose the one that makes the best financial sense for your situation. Be open to making the best decision for your financial wellbeing. 1. The Lender's role is to provide you information and education about reverse mortgage products, the amount of funds you can get from your equity, funding options - lump sum, monthly income, line of credit or a combination of these options. They educate and guide you on the reverse mortgage process. The lender does not give you any advice and is not qualified to give you any advice. The Lender has no responsibility or fiduciary duty to the borrower. 2. The HUD Counselor's role is education and information on the reverse mortgage process. The counselor's use of the new Financial Interview Tool (FIT) gives the borrower the illusion they are receiving the necessary financial and legal advice because the counselor ask you financial and legal questions such as income, expenses, assets. They tell you alternatives to a reverse mortgage such as refinance, sell, line of credit. BUT legally the HUD Counselor cannot give any advice (including financial and legal). The HUD Counselor has no responsibility or fiduciary duty to the Borrower. There are fundamental differences between a traditional forward mortgage and a reverse mortgage, a few are:
The risk to the senior is life altering. You risk losing your property, equity, retirement, quality of life and everything you worked for all your life - at the time in life you can least afford to make a financially devastating mistake and are least able to recover. GET A SECOND OPINION FROM A QUALIFIED FINANCIAL ADVISOR OR INDEPENDENT REVERSE MORTGAGE SUITABILITY ADVISOR. That way your decision will be based on the facts, consequences, costs and benefits for your circumstances. Before reading any further please click on this link: 681 Benson Way, Thousand Oaks, CA to find out what can happen if you don't understand the terms and consequences of a reverse mortgage before signing on the dotted line. Most of us have seen ads that claim reverse mortgages are FHA insured making them safe for the consumer. Actually, the borrower pays a huge mortgage insurance premium that protects the lender and ensures they will recover 100% of the loan, fees and costs. In fact, if the sale of your home isn't enough to repay the loan, interest and costs the Lender will submit the loan to FHA for the balance. The Lender is never at risk. The reverse mortgage industry received subsidies of $700,000,000 in FY 09 and $800,000,000 in FY 10 - that is 1.5 billion in taxpayer subsidies in two years to provide full repayment of reverse mortgage loans to the lender. These are loans already defaulted, foreclosed and property sold that have left seniors homeless, helpless, on public assistance if they are not deceased. Are you aware there are "17 Triggers" that cause default and foreclosure? There have been approximately 775,000 reverse mortgages sold. In an HUD audit report in 2011 there were an astonishing 49,000 reverse mortgages in default for one of those "Triggers" nonpayment of taxes, insurance. Every one of those borrower's signed a disclosure and acknowledged they would pay their taxes and insurance but without planning and use as a tool for financial security - how will that happen once the reverse mortgage funds are spent and you can't access any further equity in your home?. Until all reverse mortgages are sold with the involvement of a Professional Financial Advisor this problem will continue to mount with no help for vulnerable senior victims and the taxpayer on the hook to bail out the lenders. Of course there is absolutely no motivation to determine the suitability or consequences to the borrower. The Reverse Mortgage Industry spends millions of dollars lobbying against any regulation. They spend millions more fighting everyone who dares to file a lawsuit. Having said all of this - I am not against Reverse Mortgages. I advocate for the borrower's best interest first. A reverse mortgage sold to Seniors who understand the long term consequences and costs, have the Advice of a Financial Professional are able to make a conscious informed choice about the suitability of the product for their unique circumstances. |
Reverse Mortgage Consumer Advocate
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