HOME EQUITY THIEVES

Many seniors have a lot of value tied up in the equity in their home. Facing increasing cost, it can be very enticing to look for a fast way to sell their home or get some access to the funds tied up in home equity.

WATCH OUT FOR THESE PROBLEMATIC OPTIONS:

• “WE BUY HOMES FOR CASH”

– you will see advertisement for a quick cash sale of your home unfortunately they can downplay the value of the home or overstate the repair cost, and you may find you got less than fair value for your home.

• HOME OWNER BENEFIT PROGRAMS – in this program you agree to list your home with a specific reality company (most seem to be in Florida currently) when you decide to sell your home. If you sign a contract with them for the future listing you get a small up- in the future and you don’t follow through listing with them, they can sue you for damages for the loss of the commission. They may even force foreclosure to get that award for the suit.

• PROPERTY ASSESSED CLEAN ENERGY (PACE) – this is sold door to door currently in California, Florida and Missouri. You sign up for financing home energy improvements which are repaid over 10-25 years through an increase in your property taxes. This can increase the risk of tax foreclosure due unpaid property taxes and put the program 1st in line for repayment which can make it harder to do any refinancing of your mortgage.

• HOME EQUITY CONVERSION REVERSE MORTGAGES - these are not a scam and can be a reasonable way to access the home equity without having to sell your home. It is important to fully understand how a HECM works and if it is for you. Beware of aggressive lenders and never enter a HECM if you still have questions. The Resource Center staff can provide information on how a HECM might work for you.