MIAMI GARDENS, Fla. – A retired South Florida teacher and her husband are fighting to stay in their home after taking out a reverse mortgage.
Local 10 News consumer investigative reporter Christina Vazquez uncovered thousands of complaints filed against the Texas-based lender.
This comes as federal regulators issue a warning about the integrity of reverse mortgage advertising.
"This is what I spent 47 years as a crane operator to do," said Willie Leland. "Buy myself a home for my family."
Leland and his wife of more than 50 years, Rose, a retired teacher, raised a family in a modest home in Miami Gardens.
According to their attorney, Johnny Gaspard, the couple took out a reverse mortgage in 2008.
A reverse mortgage is a type of loan that allows homeowners 62-years and older to borrow against the accrued equity in their homes. The loan must be paid back when the borrower dies, moves, or no longer lives in the home.
There are also loan requirements explained Gaspard, "Homeowners are required to pay the taxes and insurance every year."
Gaspard said the Lelands forgot to make that payment in 2013.
After learning of the oversight Gaspard said he worked with Champion Mortgage to develop a repayment plan for the nearly $9,000 owed.
He said the Lelands agreed to the plan, signed the agreement, and mailed it to Champion Mortgage along with the initial payment.
But according to Gaspard, the lender claimed that agreement was lost in the mail this time last year.
He said Champion Mortgage also "erroneously, force-placed insurance on the Lelands' home for 2014."
Despite paying for insurance and taxes in 2014 and 2015, Gaspard said the company placed an eviction notice on the couple's door last month.
"The bank is unwilling to accept the money and is instead wanting to take their home," Gaspard stated during a news conference on Tuesday. "The bank should be willing to work with them to at least make the payment which is what they are willing to do. The Lelands aren't saying we don't want to pay it and they have since then paid 2014, without the bank's help, and 2015, without the bank's help. And they have the means to cover the outstanding amount for 2013 as well."
"It hurts to the core," stated Leland. "It is just overwhelming."
Champion Mortgage is a division of Nationstar Mortgage, which has an F rating with the Better Business Bureau. There were 3,260 closed complaints with BBB in the last three years, 796 closed in the last 12 months.
"When they first approached us about this, just the way they explained it, it was something that we couldn't lose, but now at the end, now we know it is different," Leland said.
Just this year, the Consumer Financial Protection Bureau issued a consumer advisory about reverse mortgage advertising.
They found, "confusing, incomplete, and inaccurate statements" regarding borrower requirements and risks in their review of advertisements from a variety of lenders.
They also found "many ads" didn't mention that "seniors could lose their homes if they don't satisfy the loan requirements such as paying property taxes or homeowners insurance."
"If you forget, they are coming after your property and they are going to foreclose on you," stated consumer protection attorney Jason Weaver.
"In a reverse mortgage the bank is sending you a check. So when you are getting a check every month it's easy to assume that you don't have an obligation or responsibility and don't have to pay anything but that's not true," explained Weaver. "It is really a loan, there are terms, there is a mortgage, and unlike what you hear on TV if you don't make certain payments, they can take your house."
Weaver said while a reverse mortgage does work for some people; it is something you need to review in detail.
"It is not that they are overall a bad deal, it is that you really have to be careful about what you are getting into," Weaver said. "If you are not careful and you don't understand what your obligations are, in particular if you don't pay those taxes and insurance, you are going to find yourself in trouble. What sometimes makes it more confusing is that there are different kinds of reverse mortgages."
Leland said his advice to others is to "think about it, don't sign anything until you are sure. This is something that's being advertised and it is really not the truth, not the way they are advertising it."
"My first advice is to get a good mortgage broker and don't call the people on TV," Weaver said. "I don't know if they are good or bad, but I would go with someone who maybe gives you a little more personal attention, where you can ask questions about the loan, and where somebody is going to maybe tailor a loan program to your specific needs. Make sure you understand what you are actually going to have to pay. Ask the mortgage broker what could happen to make me lose my property, because they always sell it as this is yours forever, that it is a great thing."
The CFPB said to consider these reverse mortgage facts when you see advertisements:
"It is sort of like a trick, to get (homeowners), especially older people, to give up their home," Gaspard said.
Willie Leland and his wife Rose can't understand why the lender wants to kick them out despite a previous repayment agreement to pay back 2013's missed payment toward taxes and homeowners insurance.
"We agreed to do what they asked us to do," Leland said.
"These elderly people who have been in their home almost 36 years, 37 years, four generations have been here, and they want to keep their home yet, this bank had decided that this $8,000, $9,000 is not enough," Gaspard said of the Lelands. "They don't want that money, they want the home, and that to me is what the problem is. There is substantial equity in this property and I am believing that that's the bank's main motivation for trying to take the home."
Gaspard filed an emergency motion to stay the writ of eviction and vacate certificate of title and vacate judicial sale.
A hearing is scheduled for Monday before Judge Antonio Marin.
Gaspard said the eviction is on hold pending Monday's hearing.
"So, hopefully they will change their mind," said Leland of the lender. "I really do I hope they change their mind because I have a lot of memories here. We've been here a long time, we love it here."
"It gives a bad name to reverse mortgages, despite all those nice commercials they seem to promote on TV," Gaspard said.
Local 10 News called Champion Mortgage on Wednesday requesting a statement, but no one returned that call.
If you are having a problem with your reverse mortgage or having problems getting through to your mortgage servicer, you can submit a complaint to the Consumer Financial Protection Bureau.
Follow Christina Vazquez on Twitter @CallChristinaTV
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