Senior Financial Tips

Senior Financial Fraud: Don’t be a victim

Reverse Mortgage Glendora.jpgOne in three senior citizens is the victim of financial abuse, according to a study done in 2016 by Time.com. Tragically, on average, victims lose about $36,000.

“Most people think (fraud) will never happen to them. But it does. And it does on a daily, hourly basis,” says Debra Whitman, public policy officer for the American Association of Retired Person (AARP).

Attractive to con artists because they usually have savings accounts and excellent credit, today’s senior citizens grew up in the 1930’s, 1940’s and 1950’s, when people were raised to be polite and trusting. Scam artists exploit these traits because they know most seniors will find it difficult to confront, hang up, or just say no.Say no to Fraud

One of the most important steps toward fraud prevention is awareness.

If someone calls to offer you fast cash, it could be fraud.

If a telemarketer says you have a “limited” time to respond to his or her offer, it could be fraud

If a caller promises something that sounds too good to be true, it could be fraud.  

If a computer tech contacts you to say your software has a virus, it could be fraud.

If you click on an online offer that takes you to a flashing screen and impacts your computer’s speed, it could be fraud.

Not only are seniors more likely to be victimized, but they are less likely to report fraud than younger folks, for several reasons:

  • They don’t realize they have been scammed.
  • Either they don’t know who to report it to.
  • They are too ashamed at having been scammed.

So how can you avoid fraud?

Using One Time Password When Shopping Online, Banking Security ConceptOnline Safety

  1. Use strong passwords. Don’t use the word “password,” or 12345, which can easily be hacked.
  2. Don’t share your passwords or write them on post-it notes next to your computer.
  3. Be careful with social media posts. Set your privacy settings high. And don’t over-share. If you broadcast vacation plans, burglars and identity thieves may take advantage.
  4. Use only secure Wi-Fi networks. Don’t do online banking or share other sensitive information on public hotspots, such as libraries, hotels or coffee shops. Hackers can easily grab your information from an open network without ever touching your computer or your phone.
  5. Never open suspicious emails or click on links inside emails unless you are 100% certain of the sender. Your actual email provider, bank, Internet service, or the IRS will never ask for your personal information via email.
  6. Don’t click on pop-ups, even if they say offer quick-fixes. For example: “Your computer is slow. Click here to speed it up.”). Clicking might unleash a virus.
  7. Protect your identity. Don’t use your full name, date of birth, home address, email address, social security number to create passwords.Telephone Scams Seniors.jpg

Telephone Safety

  1. If someone calls, offering or asking for anything, be suspicious. If you call the company, you can trust what the customer service rep says. So, if you wonder whether someone is legitimate, tell them you will call the company yourself. If they call you, they could be a scam artist.
  2. Refuse to give personal information by phone. Representatives from legitimate companies will understand this and should have security protocols in place to protect your personal information.
  3. Take your time. When in doubt, do research. Don’t feel pressured to act on anything a stranger tells you over the phone.
  4. Do your part. Report fraud. If you uncover a fraudulent operation, report the incident to the FTC at 877-FTC-HELP (877-382-4357). You can also report telemarketing fraud to the FBI. Report Fraud against Seniors to FBI.jpg

If you have questions about how much reverse mortgage capital you might qualify for, contact Manny LaFosse, your certified reverse mortgage consultant. Residents of Los Angeles County and North Orange County should look to the experts at Reverse Mortgage Certified for great rates and information about the reverse mortgage loans as well as several other available financial options.

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Can a Reverse Mortgage add to your Golden Years?

Heading into retirement can be a stressful time for seniors. You’ve worked hard, saved money, and are ready for life’s new challenges. A consistent concern among soon-to-be-retired seniors is figuring out how to pay for all of the monthly expenses. For those who are already retired, they often need a few hundred extra dollars a month to pay for medical care, visit family, and simply have a more fun-filled retirement experience.

Managing retirement takes planning and resources. Besides pensions (for the lucky ones), 401k plans, and Social Security, another financial tool known as “reverse mortgages” is available to senior homeowners who have a significant amount of equity in their homes.

Reverse mortgages are a type of loan that allows seniors to take out a portion of the equity in their home (the amount it’s worth above what’s owed) and receive that money as a payment, either over time or as a lump sum. The loan does not have to be repaid unless the homeowner moves or passes away. And, the title to the loan always stays in your name, not the bank, giving you peace of mind.

There are several advantages to reverse mortgages for seniors:

  • Use the money in the way it suits you best. The money from a reverse mortgage can be used for nearly anything, including daily living expenses, travel, support for grandchildren, or other uses on an extensive list.
  • You can still provide your heirs with some financial support. Seniors with a considerable amount of equity can have access to capital and still leave money to their heirs. When the home is sold, the estate simply pays off the outstanding reverse mortgage and the remainder of the money goes to the estate beneficiaries.
  • These loans don’t require a payment, so they’re very different than home equity loans where you have to maintain a monthly minimum payments.

A popular type of reverse mortgages are known as Home Equity Conversion Mortgages (HECM). Now what exactly does that mean? HECM are reverse mortgage insured by HUD (the federal government housing agency). These loans are available to homeowners 62 years of age or older, although younger spouses can be included on the loan. Additional information and benefits:

  • Homeowners are required to receive information from a qualified third party before signing for the HECM loan. Unfortunately, some seniors are persuaded to make poor financial decisions. Using this information resource is a great way to protect seniors and their cash!
  • It’s only available through FHA-approved lenders.
  • HECM loans give borrowers the income they need that can supplement Social Security and retirement accounts, oftentimes allowing them to stay in their long-term home.
  • Lenders should work with borrowers to ensure they can cover the costs of taxes and insurance in retirement.

Important things to understand before taking on a reverse mortgage:

A reverse mortgage is a powerful way for seniors to generate needed capital, but it does come with some caveats:

  • You still must pay property taxes and homeowner’s insurance payments. The reverse mortgage does not cover these costs.
  • There are closing costs that come with reverse mortgages which are similar to those found with traditional mortgage loans, however these can often be included in the loan, so seniors don’t have a big out-of-pocket expense.
  • A new option, called Voluntary Life Expectancy Set Asides,”  is an amount set aside for payment of current and future  property taxes and home insurance by the lender. This cost can be added and included in the loan.

Advice for Senior Borrowers

All of the terms and rates of a reverse mortgage can be confusing. It’s important to work with a lender that can patiently guide you through all of the benefits of a reverse mortgage and be upfront about some of the smaller disadvantages. Never be afraid to ask questions and to have answers in writing if you are concerned about any of the details of your reverse mortgage. 

Have questions about how much reverse mortgage capital you can receive? Use this online calculator to insert your specific information and see how much funds you can receive with a reverse mortgage.

Residents of the San Gabriel Valley and North Orange County should look to the experts from Reverse Mortgage Certified for great rates and information about the HECM loan. Visit www.https://reversemortgagecertified.wordpress.com/ to learn more.

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