A new report released by Illinois Public Integrity Research Group says senior citizens are being targeted by scammers and many older American consumers are entering financial agreements that put them at risk for predatory lending.
The report scoured thousands of consumer complaints filed with the Consumer Financial Protection Bureau and found the most complained about issues include mortgages, credit report errors and debt collectors.
Reverse mortgages, which are unique to older consumers, allow homeowners to use home equity as a security in lieu of paying mortgage. According to Illinois PIRG, many consumers are entering into the reverse mortgages without fully understanding certain fees and property taxes still need to be paid.
“Their home can be foreclosed upon and they can not only lose the loan that they got, but also be kicked out of their home,” said Illinois PIRG director Abe Scarr.
Many older consumers also find themselves having difficulty fixing inaccurate debt appearing on their credit reports, according to the PIRG report. Scarr said a lot of times the credit mistakes could be the result of bad medical debt or a consumer being billed for a procedure they did not have.
Or the mistakes could be the result of bad information caused by identity thieves.
Judy Nosko said someone recently stole her identity and used her credit card information to purchase $6,000 worth of designer accessories, jewelry and other goods.
The malicious hacker even sent Nosko a text message and bragged about having access to all of her credit cards and her bank account.
“It’s really got to stop,” Nosko said. “It’s nerve-wracking.”
While she reported the theft to her bank and credit card companies, Nosko is now watching her credit very closely.
“Every day I think, now can I go to the store. Am I gonna be able to use my card? Is someone else gonna take it?” Nosko said.
The report also suggests debt collectors are increasingly becoming a thorn in the side of seniors by using aggressive collection tactics or threatening consumers with jail.
“Documenting everything on your end and demanding documentation from the debt collectors are important steps that you can take to make sure you’re not being taken advantage of,” Scarr said.
The Consumer Financial Protection Bureau has handled more than one million consumer complaints since it opened in 2011.
Illinois ranks 27th as far as the number of older Americans filing complaints with the CFPB.