Minnesota AG, lawmakers target reverse mortgages
- Posted by admin on February 6th, 2009 filed in Reverse Mortgage Info
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Minnesota Attorney General Lori Swanson and DFL lawmakers are introducing legislation they say will protect senior citizens from aggressive lenders pushing reverse mortgages on their homes.
A reverse mortgage is a type of loan that allows seniors to convert home equity into cash.
But Swanson says some seniors are being persuaded into making bad decisions about reverse mortgages, which can come with high interest rates and fees. And she says some lenders are trying to get seniors to take out a reverse mortgage loan and use the money for risky investments.
Swanson says the mortgage meltdown has led more lenders into the reverse mortgage business.
The legislation would allow seniors to rescind a reverse mortgage agreement within 30 days and would require seniors seeking a reverse mortgage to get independent counseling on the risks and benefits of the loan.
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