An increasing number of seniors facing foreclosure are opting to take out reverse mortgages on their property, according to recent federal data. A reverse mortgage allows cash-strapped seniors to borrow against the equity in their home that has built up over the decades- but it also comes with financial risk. Property owners are still responsible for keeping up with other charges, including the taxes and insurance on the property.
A HUD report issued last fall found that nearly 90,000 reverse mortgage loans held by seniors were at least 12 months behind in payment of taxes and insurance and were expected to end in “involuntary termination” in 2017. That is more than double the number the year before.
More than 18 percent of reverse mortgage loans taken out from 2009 to June 2016 are expected to go into default because of unpaid taxes and insurance, according to the HUD report.
The federal Consumer Finance Protection Bureau has warned seniors about deceptive advertising practices when it comes to reverse mortgages. Last year, the federal agency fined three companies — American Advisors Group, Reverse Mortgage Solutions and Aegean Financial — for alleged false claims, misleading seniors to believe that if they took out a reverse mortgage they would not have to make monthly payments or face foreclosure, leaving out the risks of failing to pay property charges.
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Choosing the right attorney can make the difference between whether or not you can keep your home. A well-qualified Miami foreclosure defense attorney will not only help you keep your home, but they will be able to negotiate a loan that has payments you can afford. Miami foreclosure defense attorney Timothy Kingcade has helped many facing foreclosure alleviate their stress by letting them stay in their homes for at least another year, allowing them to re-organize their lives. If you have any questions on the topic of foreclosure please feel free to contact me at (305) 285-9100. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.