Posted on 08/25/2010 12:55:22 PM PDT by luckybogey
This sleazy ad has been on cable news all day. Former presidential candidate and country bear Fred Thompson wants old people to get "Absolutely FREE," government-backed reverse mortgages. What do we know about this shady company Thompson is endorsing?
...Oh right, and they're government-backed! That's how investors get paid. (Fred Thompson, a true Fiscal Conservative, makes a big point of this "full government backup" in his terrible ad.)
Reverse mortgages are available to homeowners who are 62 years old or older and own their homes outright or have a substantial amount of home equity, according to the HUD site. The vast majority of reverse mortgages are insured by the Federal Housing Administration, through the Home Equity Conversion Mortgage (HECM) program.
The reduced fees on reverse mortgages are a result of another important industry development: investor demand for securities backed by those mortgages, Bell said. These securities are backed by Ginnie Mae, based on a reverse mortgage insured by the FHA, he said, and with that combination, "you have a very secure investment."
But would ex-Senator Fred Thompson, America's most trustworthy conservative political figure, endorse financial products from a company of sleazy repute?
It just so happens that this company, American Advisors Group, was sued by Illinois Attorney General Lisa Madigan in February:
Attorney General Lisa Madigan filed lawsuits against two mortgage brokers for using unfair and deceptive marketing practices to solicit seniors for reverse mortgages.
"These companies used extremely misleading language in their advertising, sometimes even disguising their loans as government benefits that borrowers don't have to repay," said Madigan. Many consumers have reported that they didn't even know these offers were for reverse mortgages or a loan of any kind added Madigan.
(Excerpt) Read more at gawker.com ...
RMs are totally legit and for many seniors who have a lot of equity in their home, it’s a reasobable way to meet monthly expenses.
The kids are screwed out of the inheritance but tough sh!t....Get a job.
Darn tootin! I am so hurt that Ed didn't leave me anything. Well he COULD have!
Serious now, it was his money while he lived, he did right for himself, as is right and proper. Beneficiaries (and particularly prospective beneficiaries, which is what they really are) should not be confused with creditors.
I look at Gawker all the time, love their ‘Blind Items’, but they are DISTINCTLY progressive in political outlook; meaning they demean and ridicule conservatives, especially the Tea Party, Sarah Palin, Rush, etc. I avoid any story there with a political hook.
Fred has always been an empty suit. That’s why he was a good actor.
Was that a Tennessee story? He does seem like he’s earned the right to accept any job he wants without nit-picking by people who pick nits.
I’m not sure why anyone (except possibly the heirs of folks with most of their assets in a paid-up house) thinks turning one’s house into an annuity one can live in is “sleazy”.
As with all financial instruments, one has to make sure that a reverse mortgage is expected to perform as desired and understand what risks are involved and be willing to assume them.
You are dead wrong....all Reverse Mortgages are loans...the bank owns nothing. The homeowners have title to the property...They are no different than a conventional mortgage....you can pay them off anytime you choose.
Get your facts straight before you mis inform fellow FREEPERS... I have originated 100's of RM's and know what I'm talking about
I know that my Grandmother got one many years ago when they were first offered and it has saved her home and her life. Of course I’m sure the bank didn’t expect her to live to be 93.
But that would require people to take responsibility for their actions! What kind of monster are you?
I agree but we might as well put on our flame retardent suits.
Looks to me like the only possible losers would be the "heirs". Waaaah, mom and pop spent my inheritance.
Also let me add that Government Insured RM’s are insured that the homeowner of the beneficiary’s can never owe more than the home is worth. There is an abundance of information available on the internet about Reverse Mortgages, but it’s clear that a bunch of posters on this thread haven’t taken time to educate themselves and make patently untrue statements....
Fred should team up with Lee Majors (Six Million Dollar Man) and his hearing aid commercial. They could offer a senior discount...
http://www.youtube.com/watch?v=I9b1M6rlemo
Of course not. They can take the secured property. I know of a few loans where the kids will get something and while RM company will get screwed.
Yep, it's hard to sell something you don't own.
I've been trying to talk my elderly parents into some form of this for years. They are low income but their one big asset is their paid for house. They want to leave it to me and my siblings, none of whom need the money.
Right. So the guy that wrote that article is either dishonest or stupid. Well, he could be both.
That’s interesting. Question: is it a “loan” if you never have to pay it back, or is it a partial equity transfer masquerading as a loan, and backed up by the Federal government (i.e. - us taxpayers) in the case of default. Just curious.
this might be a GREAT deal when hyper inflation sets in
buy a cheapo house now and pay for it
when the inflation hits 4oo or 500 percent reverse mortgage it and live off the proceeds
this might be a GREAT deal when hyper inflation sets in
buy a cheapo house now and pay for it
when the inflation hits 4oo or 500 percent reverse mortgage it and live off the proceeds
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