Seniors Beware Of Mortgage Charlatans

12/03/2007

posted by N. Sioris

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Because of the current credit crises in the conventional "forward" mortgage market, many loan originators that normally would not be involved with reverse mortgages, are now eyeing the reverse mortgage market as a ripe opportunity to make money.

In the past, reverse mortgages were thought to be the "antidote to predatory lending practices," according the the popular book; "Reverse Mortgages For Dummies." Reverse mortgage loans take a lot more effort to sell and explain to the consumer, the selling cycle is usually much longer because the products are complicated, and many seniors wish to have adult children or other advisers sit in on the meetings and help with the decision. HUD counseling is required before an application can be taken, and the fees are capped and regulated by HUD. Therefore, in the past, the unscrupulous mortgage brokers stayed away from selling this product. For them, reverse mortgages were too much trouble,
took too much time, and commissions were considered low.

However, now that the traditional mortgage market has all but imploded, there are droves of mortgage originators out there looking for other products to sell. Seniors need to be aware of this fact and make sure that the representatives that they speak with, truly have the senior's best interest at heart... not the sales commission.

Some things to ask before you do business with a loan originator are:

1. How long have you been selling reverse mortgages?
2. Do you sell other types of mortgage products? (you want a representative that sells ONLY reverse mortgages.)
3. Are you a member of NRMLA... (National Reverse Mortgage Loan Association)

Fortunately for seniors, there are a lot of safeguards in place to protect the consumer. However, it is still a good idea to be cautious, ask a lot of questions, get several comparisons, take your time to make your decision, and most of all never allow anyone to pressure you into a decision if you are uncomfortable.

If you are interested in getting a personalized reverse mortgage comparison from a reverse mortgage originator that ONLY works in the "reverse" market, please request your free analysis here.