For years, reverse mortgages were offered “risk-free” to seniors looking to tap into their home equity. Now, thousands are facing foreclosure – and black borrowers are hardest hit. Unscrupulous lenders targeted African-American and lower-income areas, encouraging elderly homeowners to borrow money while glossing over the risks.
McGraw Center Fellows Jeff Kelly Lowenstein and Nick Penzenstadler spent almost a year analyzing more than 1.3 million loan records to document practices consumer advocates have complained about for years. Nearly 100,000 of these loans have now failed, blindsiding elderly borrowers and their families and dragging down property values in their neighborhoods.
Their story made the front page of the June 13 edition of USA Today.