American Advisor Group

This message is regards to Peter's complaint. The company explained that Candy's response on March 9, 2009 was incorrect. The company did not mention anything else. Candy seemed to misunderstand her mother's reverse mortgage. They are insured by the Federal Housing Administration (FHA), a branch of the U.S. Dept. of Urban Housing and Development (HUD), which means the borrower and borrower's heirs cannot be held liable for the loan beyond the value of the home.

The FHA insurance covers any further financial obligation to the lender, the borrower does not. Furthermore, the borrower only pays for the maintenance of the home, property taxes, and insurance--not interest. My advice: perform your own research. There is a lot of incorrect information about reverse mortgages out there, so do your research. HUD has a great website as well as AARP.

I have been researching reverse mortgages for a while and was investigating AAG. I then ran into a complaint on your website. This complaint was then disputed by someone representing the company. I don't know the specifics of that case but the representation from the company that it is complying with all state regulations is false, and your readers should know it. According to the Boston Business Journal, the State of Massachusetts has ordered AAG to stop selling reverse mortgages in that state. The text from the article is as follows:

"The Massachusetts Division of Banks has issued cease and desist orders to four mortgage lenders/brokers for allegedly violating the state's reverse mortgage laws.nThe orders on three lenders, First Call Mortgage Company Inc. of Andover, Mass., Sun West Mortgage Company Inc. of Cerritos, Calif., and Gold Reverse Inc. of Anaheim, Calif, were in response to allegations that the companies were making loans to Massachusetts seniors without an approved plan that included counseling on the mortgage.The Division's order against broker American Advisors Group was for engaging in unfair and deceptive marketing of the loans through a direct mail campaign where reverse mortgages were marketed as government benefits."

I am writing to request the removal of your posting regarding American Advisors Group dated March 9, 2009. The information provided by the complainant is incorrect or inaccurate and reflects poorly on our company that has conducted business according to all state and federal laws and regulations. The complainant references "keeping up with interest payments every month." This is not correct.

As per any FHA-approved HECM reverse mortgage, interest fees are added to the loan and are not repaid until the loan reaches maturity--normally, when the last borrower moves out of the home. This is clearly disclosed in the loan documents and is part of the government required counseling each borrower undergoes before closing the loan.

Also, the complainant's assertion that the loan will reach $300,000 and will leave her family unable to pay it off is again, untrue. Part of an FHA-insured loan includes Mortgage Insurance Premium which ensures that a borrower can never owe more than the value of their home. The complainant was clearly not present at any document signings nor the counseling and has a complete misunderstanding of the product and the program. Frankly, we are surprised that consumeraffairs.org would post a complaint like this without doing any kind of diligence on the facts behind the complaint. Please take down this posting or provide us the appropriate opportunity to respond.

Yes we contacted them about a Reverse Mortgage and was told that we Qualify for a reverse mortgage on a mobile home. After paying upfront fees for inspections ect. as we thought was high we paid them which was our mistake. They got access to our credit reports then what happened then was at the last moment we were told that a mobile home did not qualifey for this type of mortgage. Due to the fact we are in a flood area.Now on top of that we have every sredit repairing company that exists is now calling us they even go as far as to say send us your bills and pay uup front over $ 500.00 per month to them to be put in an account to pay them off.

The kicker to this story is our bills are current but that they can have them paid off in 4-6 years but we due without credit for the next 7 to 10 years. But they will repair your credit to better than new wehre do all these credit repair companys come from and how do they access your credit information as they know more than you do. Then comes credit card cancellition notices we dont have that credit card anymore. but these dept helpers keep on comeing out every day.

Also we were not told anything about makeing interest payments monthly like the outher lady. if your over 60 years old you must have sucker stamped on you. Get out of this mess as it only gets worse as to who all now has your credit information and how they obtain it is the question of the day. Emotional destress getting back your credit, along with the dailey harassment and where to go next.

My mom decided to go into a reverse mortgage with her home. She received information from American Advisor Group and spoke with Mr. Jon Leonhardt who is no longer with the company. He explained to her that she would not have any more monthly payments in regards to mortgage payments. He also told her when she wanted she would be able to refinance when she needed to. He never told her that she would have to keep up with interest payments every month.

My mom made these changes back in september of last year. Now her original loan amount from September to now has increased by $10,000 more and she has been told that by the time she passes on or decides to sell the house her mortgage could be up to $300,000. Leaving her family unable to pay it off. Now she wants to refinance but no ones is willing to help her. What can she do? Are reverse mortgages legal and owned by the government?