RICHMOND, VA (WWBT) - A new warning for seniors tonight from the FBI.
As the housing market slowly recovers, you still need to watch out for reverse mortgage scams. Reverse mortgages, or home equity conversions, increased more than 1300 percent between 1999 and 2008.
That a fact conmen are using to rip unsuspecting seniors off.
The FBI and the U.S. Department of Housing and Urban Development are urging homeowners, especially senior citizens, to be vigilant when seeking reverse mortgage products.
Reverse mortgage scams are engineered by professionals in a multitude of real estate and financial services to steal the equity from the property of senior citizens or to use seniors to unwittingly help the fraudsters steal equity from a flipped property.
So, how are they dupping people? In a lot of the reported scams, victims are offered free homes, investment opportunities, and foreclosure or refinancing assistance; they are also used as straw buyers in property flipping scams.
Seniors are frequently targeted for this fraud through local churches, investment seminars, and TV, radio and mail ads.
Now, here's what you do. First, don't respond to unsolicited ads.
Be suspicious of anybody who says you can own a home with no down payment.
Don't take a payment from somebody for a home you didn't buy.
And, if you're thinking about a reverse mortgage, find a counselor for yourself.
A legitimate reverse mortgage product is insured by the federal housing authority and lets eligible homeowners access the equity in their homes without creating a monthly payment.
If you are a victim of this type of fraud and want to file a complaint, you can call your local FBI office or hud's hotline at 1-800-347-3735.