The Importance Of Protecting Seniors From Financial Scams

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For the average American household, the debt to income ratio is dire. Small wonder then that an almost national desire to become debt-free has presented itself as something of a boon for fraudsters and financial scammers. No one is exempt from money swindlers but worryingly, seniors are often the main targets.  More than one in three elderly people over 85 experience some degree of dementia, making this age group particularly attractive to scammers.

Why do fraudsters set their sights on seniors?

Several reasons have been identified regarding why seasoned scammers pick on the elderly. Older people are often isolated, and less likely to tell others about odd requests. They may also be vulnerable, especially if they’ve been widowed, and may be genuinely seeking company. This may open the door unwittingly to romance or other scams. Couple this with a genuine sense of courtesy to others, and your average senior is often set up for exploitation.

These psycho-social reasons also go along with practical ones in the minds of scammers. Often, a retired person will have ready cash in the form of savings and an excellent credit score making them perfect candidates for financial identity theft. They also tend to be more reluctant to reporting financial crimes, even if they know how to. It is imperative to protect yourself and your hard earned money by not allowing these types of mortgage scams to impact your life. The proverb of ‘too good to be true’ stands firm with everything even if your natural inclination is to give the benefit of the doubt.

Reverse mortgage scams

Amidst the 2008 housing foreclosure crunch, one of the leading scams to emerge and stay popular is the reverse mortgage scam. In a reverse mortgage, money is lent to you against the equity in your home, and is paid out in monthly installments.

The monthly payments often supplement a retirement income. The reverse mortgage owed to the lender is then most often recovered when the house is sold due to the homeowner moving or dying.

The worrying aspect about the various manifestations of this scam, is that it can be done subtly, without resembling blatant fraud. Worst of all, is that mortgage manipulation is regularly committed by someone loved or trusted by the elderly homeowner.

Protecting yourself or your loved one

If you’re asked to take out a reverse loan, seek expert independent advice, and get a second opinion if you can. Educate your elderly loved one about never giving in to pressure for any financial requests, as well as about the existence of financial scams.

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