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Consumer interest in reverse mortgages is growing, which is good news for the lenders underwriting the loans and for the brokers originating them but not for the seniors targeted or for the credit unions getting aggressively recruited to help market the product.

What’s so bad about these mortgages? Here’s a hint: The folks promoting them are the same finance professionals who helped create the subprime mortgage mess, and they’re using the same business model: large commissions for originators, outsized fees for lenders, and high costs and outsized risks for borrowers. We’ve seen how this approach worked out for subprime loans, and there is no reason to expect a different outcome for reverse mortgages.

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