“Mortgages for seniors are a growing market, but experts say there are risks”.
A growing number of seniors are turning to mortgages to finance their retirement, but experts warn that this can be risky. In a report by CBC News Business, it was revealed that seniors are increasingly taking out mortgages on their homes to supplement their pensions, pay for renovations or help their children with down payments on homes. However, the report also highlighted that some of these mortgages come with high-interest rates and hidden fees that can make them difficult to pay off. Whether you consider these mortgage scams or fraud, it is wrong and needs to be stopped.
‘Elaborate scam’ leaves seniors with high-interest mortgages they didn’t want or understand
According to the report, the number of seniors taking out mortgages has been steadily increasing over the years. This is due in part to rising living costs and the fact that many seniors are living longer and therefore require more money to sustain their retirement. However, experts warn that taking out a mortgage later in life can be risky, as it can lead to financial strain and even homelessness if the borrower is unable to keep up with the payments.
The report also noted that some lenders are targeting seniors with aggressive marketing tactics, offering them loans with high interest rates and hidden fees. This has led to some seniors being trapped in debt, with little hope of ever paying off their mortgages.
In conclusion, while mortgages can be a useful tool for seniors looking to supplement their retirement income, it is important to be aware of the risks involved. Seniors should carefully consider their options and consult with financial experts before taking out a mortgage on their homes. Additionally, regulators should work to protect seniors from predatory lending practices and ensure that they are not being taken advantage of by unscrupulous lenders.
In the article, most of the victims quote interest rates being charged at 25%, although they don’t say if this is on the mortgage or APR which includes fees. It should be noted that currently, the rate of interest that can be charged legally in Canada is up to 60% APR. There are plans to lower this.