At the risk of being unduly repetitious, we have been continuously appalled by certain offensive and unscrupulous televised commercials which surreptitiously prey on the assumed vulnerability of the ubiquitous, circumstantial cash-tight retired citizen, and to once again desire to express our repulsion.
As declared in an earlier writing, the most egregious of such efforts to shamefully garner huge profits by sleight-of-hand misrepresentation continues to rankle us and disturb our sense of plain rectitude and empathy for the elderly retired citizen. Such advertised deceits are most disturbingly observed in the virtual plethora of televised proposals for life insurance repurchase and home equity mortgage transactions, as set forth below:
LIFE INSURANCE REDEMPTION:
It is the ubiquitous experience of middle-class retirees, at some point in time, to find themselves “cash-tight.” Televised solicitations hawking the availability of needed cash by the re-purchase of their life insurance by insurance company in exchange for a tactical sum in profitable avoidance of the insurer’s actuarially calculated imminent responsibility to pay large sums of money to the insured’s intended beneficiar is an offer too bad not to refuse, unless truly desperate.
The amount of pre-calculated, monthly insurance premiums, paid over the insured’s lifetime are actuarially determined upon several practical factors, the most salient of which is the applicant’s age and, consequently his (statistical) lifetime. Monthly payments are profitably utilized by the insurance company for “legal” investments, viz., mortgages and secured loans) are so calculated that upon the decease of the named insured, the insurance benefit will have been covered.
It is without cavil that the older the insured, the closer he is to the experiential (actuarial) event of decease and the contractual obligation to pay the usually substantial insurance benefit; upon which the relevant premiums have been actuarily calculated and paid. The avoidance of payment of the premium payments, as seductively offerred, by the policy’s repurchase and cancellation (in exchange for a tactically calculated amount) will place certain pre-calculated funds in the hands of the insured, but will also, notably avoid payment of the policy benefits on decease to the previously designated beneficiary. The transaction of repurchase of the policy results in a remunerative windfall for the insurance company; obtained for an inadequate sum of money paid to the elderly insured and a loss to the intended, and possibly needful beneficiary.
One of the frequently shown television commercials deceitfully hawks this transaction as a “Gold Mine;” we would classify the metallurgical chemistry of such benefits as, “Fool’s Gold.”
EQUITY LOAN:
The smarmy, solicitous, and familial, loving offer by a handsome, mustached, homey, cardigan -wearing, mature movie celebrity, of the mortgage ( i,e, the,sale) of the accumulated and expensively paid for equity ownership of one’s home, for “tax-free” (your own !) money and the discharge of the obligation to make mortgage premiums can easily be revealed as another tactical and deceitful, “rip-off” of the cash tight senior (homeowner) citizen.
Fundamentally the homeowner should have the current calculation of the accurate value of the equity of the relevant property confirmed by an independent, professional source. It is the common assumption of the equity loan mortgagor that his financial obligation vis-a-vis the realty will thereafter be free of monetary and other sundry obligations; but this assumption is far from accurate. The homeowner is still obligated to take care of the proper maintenance and repair of the building and grounds (as determined by the equity purchaser) and pay the taxes and insurance on the subject premises.
One consideration should be personally considered. Many senior homeowners have an aged or infirm relative living with them. They should be made aware that, according to the provisions common to all equity loans, that upon the decease of the record title owner, the residing relative or friend must vacate the premises, and conceivably become homeless.
We abhor the disturbing state of affairs regarding the humanistic ideal of “respect for the elderly!”
-p.
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