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John F. O'Hara

John F. O'Hara
731 W Skippack Pike  Blue Bell  PA 19422
Phone:  610-277-4060
Office:  215-643-3200
Cell:  267-481-1786
Fax:  267-354-6973

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Don't Be Misled by Reverse Mortgage Ad Claims

June 16, 2015 1:45 am

Reverse mortgage advertisements are a dime a dozen, but that does not mean consumers are any less susceptible to false ad claims, says the Consumer Financial Protection Bureau (CFPB). In fact, many reverse mortgage ads do not tell the full story.

“As older consumers consider reverse mortgage loans to tap into their home equity, they need to be careful of those late night TV ads that seem too good to be true,” says CFPB Director Richard Cordray. “It is important that advertisements do not downplay the terms and risks of reverse mortgages or confuse prospective borrowers.”

A reverse mortgage is a special type of home loan that allows older homeowners to access the equity they have built up in their homes and defer payment of the loan until they pass away, sell, or move out. The loan proceeds are generally provided to the borrowers as lump-sum payments, monthly payments, or as lines of credit. Most reverse mortgages today are federally insured through the Federal Housing Authority’s Home Equity Conversion Mortgage program, which carry some regulatory requirements.

While advertisements frequently do not describe all the details of the particular product or service being sold, the incompleteness of reverse mortgage ads raises heightened concerns because reverse mortgages are complicated and often expensive loans intended for older, and frequently vulnerable, homeowners. According to the CFPB, the ads are characterized by:

Ambiguity that reverse mortgages are loans: Some consumers find it difficult to understand from the ads that reverse mortgages are loans with fees and compounding interest, and that the loans need to be repaid. Most ads either do not include interest rates or included interest rates in fine print. Other consumers thought that because the money they received through a reverse mortgage represented home equity they had accrued over time, there was no reason they would have to pay it back.

False impressions about government affiliation:
The advertisements leave some older homeowners with the false impression that reverse mortgages are a risk-free government benefit, and not a loan. Consumers often misinterpret the role of the federal government in the reverse mortgage market as providing consumer protections that are not actually offered.

Celebrity endorsements that imply reliability and trust: Many ads feature celebrity spokespeople discussing the benefits of reverse mortgages without mentioning the risks. Most consumers believe TV ads that feature spokespeople are portrayed as reliable and trustworthy.

False impressions about financial security and staying in the home for the rest of the consumer’s life: Many ads imply financial security for the rest of a consumer’s life. A reverse mortgage does not guarantee financial security no matter how long a consumer lives. A consumer can tap into their equity too early and run out of funds to draw on. In addition, borrowers with a reverse mortgage are still responsible for paying property taxes, homeowner’s insurance, and property maintenance. Failing to meet these requirements can trigger a loan default that results in foreclosure. Most advertisements fail to mention such requirements.

Incomplete or inaccurate statements made in advertisements about reverse mortgages can pose serious risks to older Americans. Without more balanced information, consumers may not make the right financial choice and jeopardize their retirement security. This means they could run out of money for their day-to-day expenses or even lose their homes.

When viewing these ads, the CFPB says to keep in mind a reverse mortgage is a home loan, not a government benefit, reverse mortgage ads don’t always tell the whole story, and without a good plan, a consumer could outlive the loan money.

Source: CFPB

Published with permission from RISMedia.


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12 Tips for Cyber Security on the Road

June 15, 2015 1:45 am

Whether in for a long-awaited vacation or heading out on business trip, many travelers take their electronic devices along for the ride. If you plan to travel in the future, keep your devices and data safe with these tips, courtesy of the experts at Wombat Security Technologies.

Leave data-packed business devices and materials behind whenever possible. If you don’t think you’ll use it, don’t take it. Ask yourself, “Is this business critical?” If the answer is no, it shouldn’t make the trip.

Limit the credit cards and personal identification items you take with you.
Before you go, make a note of what items you’re taking and any relevant customer service numbers. Store that info in a safe place so you’ll have a quick reference in case your wallet is lost or stolen.

Explore the possibility of using a “disposable” phone and laptop when traveling
, particularly if you are an executive, manager, or business insider who deals with highly confidential data. This approach allows you to maintain connectivity without exposing the contact lists, files, and sensitive information that are stored on daily-use devices. If your organization doesn’t support this type of service, make the case for building a small repository of devices that can be issued prior to travel and then be wiped clean afterward.

Don’t leave your devices unattended in public, not even for a few moments
. It can be tempting to put your smartphone off to the side while you check your bags at the airport or to leave your laptop sitting on the table while you got to the café counter to get a refill. Thieves are opportunistic; they can snatch up your device in a second while you’re not looking.

Keep your devices concealed as often as possible, particularly when in a crowded place.
Many smartphones -- particularly iPhones and newly released devices -- are coveted by criminals, and there have been known instances of particularly brazen thieves swiping phones right out of unsuspecting users’ hands and disappearing into crowds. Keep your smartphone tucked safely in an interior pocket of your jacket or bag when not in use, and consider using a wireless headset if you are “walking and talking.”

Securely store your devices if you leave them behind. Naturally, your safest bet is to keep items with you, but sometimes that’s not practical while traveling. Remember that a hotel room is not secure; many people have access, and staff members often enter your room while you’re not there. A hotel safe is a better choice than leaving items out in the open or barely concealed in a suitcase.

Turn off automatic check-ins and location tracking. These activities can reveal where you are (a confidential business trip or meeting, perhaps), but they also reveal where you aren’t. Scammers and criminals like to tap into schedules because it gives them more information about who you are and what you do.

Save the vacation posts until you’re back home. As with check-ins, the social updates you post while you’re out of town make it clear that you’re not at home and you’re not at your office. Many people have hundreds of social connections and followers, and a vast number of those online relationships are superficial. If you’re 1,000 miles away and you let everyone know that you’ll be off the clock for a week, you create a window of opportunity for a criminal to climb through. Though it’s tempting to detail your travels in real time, it’s important to consider the potentially negative ramifications of sharing this information.

Be careful about Bluetooth connections.
You may think nothing of pairing your smartphone to rental cars and other convenience devices. But did you know that information is sometimes stored after you terminate the connection? That means your contact lists and other data could be left behind in a car that doesn’t belong to you. Before you turn in your keys, make sure your data has been deleted.

Check before you connect.
Did you know that names of WiFi networks are manually created? This means that hackers can name networks anything they want. Scammers set up “rogue” and “evil twin” networks with names that sound trustworthy -- Airport WiFi, for example -- or that are similar to legitimate nearby networks -- Official Café Wireless instead of Café WiFi, for example. Once connected to a scammer’s network, your data is in their hands. To be safe, check with an employee or another trusted source before you access an open WiFi network.

Use https or a virtual private network (VPN) to protect your data.
A VPN adds a layer of encryption and security that is valuable when using any unknown connection. At a minimum, you must ensure that https is present in a web address before accessing a secure site (i.e., webmail, social media, or any site that requires a login). And whenever possible, hold off on doing any financial transactions on WiFi, including checking your bank balance or making ecommerce purchases. It’s safest to handle these activities on known, secure networks.

Consider traveling with a personal hotspot.
If you use a mobile hotspot leased from your service provider, you can be confident that you are getting a secure connection. This is particularly valuable advice for business travelers, given that it’s often necessary to network on the go.

Source: WombatSecurity.com

Published with permission from RISMedia.


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