Reverse mortgages lead to sharp uptick in seniors seeking help from foreclosure

Stephanie Bray, director of legal assistance’s Foreclosure Relief Project, said the percentage of people 60 and over needing legal help with foreclosures has more than doubled, to 78 percent of their relief clients in the last year.

News Story (New Hampshire)

Gretchen Grosky
New Hampshire Union Leader
September 17, 2017
READ THE FULL STORY HERE

Tags: Housing: Foreclosure, Housing: Mortgage

Organizations mentioned/involved: New Hampshire Legal Assistance (NHLA)


DETAILS

“I am not seeing a giant increase overall for applicants with mortgage problems, but I am seeing a sharp increase in the percentage of those clients over the age of 60,” Bray said.

Bray points the finger at reverse mortgages. A reverse mortgage provides cash to homeowners who are 62 or older in the form of a lump sum, a line of credit, or monthly check. The company takes its payment from the equity in the home, tacking on fees and interest. The balance owed becomes due when the homeowner sells, moves or dies.

“It doesn’t shrink like a regular mortgage because of the interest and fees that are being taken out,” Bray said. “The balance gets bigger — not smaller.”