Posted on September 11, 2013 at 10:57 AM
SAN ANTONIO --Janet Tannehill figures she is just days away from losing her home.
“I have been through so much,” the homeowner said. "Many, many sleepless nights.”
Financial Freedom is the name of her mortgage company, but it has been anything but financial freedom for the 68-year old, who took out a reverse-mortgage with the company to make ends meet.
Celebrities like James Garner and Peter Graves have added their endorsements through television advertisements; touting reverse mortgages as safe, financial tools.
But Tannehill said a reverse-mortgage isn’t just a tool. It can be a wrecking ball. The senior is now in foreclosure.
“I was trying to not get into any more debt or financial problems. I was trying to get out of it," Tannehill said.
As a senior citizen suffering diabetes, fibromyalgia and strokes, Tannehill said she first applied for property tax relief when bills began to mount.
State law permits homeowners age 65 or older to defer collection of property taxes as long as they own and occupy their home.
But that wasn’t enough to help her finances. So, Tannehill sought out a reverse-mortgage.
“I should’ve known better,” Tannehill said.
One of the stipulations for a reverse-mortgage is that the borrower must be current on all property taxes. So for Tannehill, thousands of dollars in back taxes became immediately due.
And Tannehill said that is when she started to default.
“You could see that I had attempted to pay my debts to the best of my ability,” she said.
“Not every loan product is appropriate for every borrower,” said Caroline Jones, the General Counsel for the Texas Department of Savings and Mortgage Lending.
The agency is responsible for oversight and licensing of the state’s mortgage companies.
Last year, the department reported receiving 988 complaints from angry consumers about their mortgage lenders. But officials said only four of them involved reverse-mortgages.
The TDSML found fault with none of those.
“No enforcement action was warranted,” added Jones.
There are rules consumers and lenders are required to follow: including credit counseling for borrowers before they sign up for a reverse-mortgage.
Tannehill remembers that experience as “fast and furious.” She said her financial credit counseling consisted of a five-minute phone call, with paperwork mailed later.
And she said the counselor never discussed the impact her property tax deferrals would have on the loan.
Tannehill said she would’ve found another way to survive financially, one that didn’t put her home up for grabs.
“I put myself in this position. I was reaching out for a miracle,” said Tannehill.
Tannehill is now getting some help from Adult Protective Services, a state agency which, in turn, has found an attorney in an attempt to help her keep her home.
If you’ve got a legitimate complaint against a bank or loan institution, you can contact the state by clicking here.