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Tom Selleck’s Reverse Mortgage Ads Spark Outrage: Tarnishing His Good-Guy Persona?

BBG News

Following the conclusion of his lengthy stint as the main character on CBS’s Blue Bloods, Tom Selleck is still taking on his most debated part by endorsing loans to baby boomers who are grappling with financial difficulties.

Since 2016, the esteemed 80-year-old Emmy and Golden Globe winner has been taking on additional work as an endorser, receiving payment from American Advisors Group (AAG), a prominent company that specializes in providing reverse mortgages to senior citizens.

After merging and adopting the name “Finance of America” in 2023, the company has continued to leverage the wholesome image of the actor, who was once titled Sexiest Man Alive by People magazine, despite the lender having a less-than-stellar reputation.

One Redditor countered the advertisements by saying: ‘It’s extremely manipulative and disturbing that affluent celebrities attempt to persuade ordinary individuals that it’s beneficial.’

Another commented, “It’s disgraceful that he exploits his achievements to peddle these poor-quality loans towards the trust of elderly people.

One post states: ‘Tom Selleck here, always ensuring I don’t suggest anything harmful to you. Today, I represent Acme Bathtub Toasters.’

As a conscientious lifestyle advisor, I’d like to bring to your attention that certain companies have been held accountable by federal authorities due to their misleading marketing strategies. These tactics often involve making unfounded guarantees to unsuspecting consumers, which is not only unethical but also harmful.

They also warn consumers about the risks of reverse mortgages in general.

Reverse mortgages are unique loans designed for senior homeowners (over 62 years old) to access the value of their property by receiving cash payments, but it’s essential to be aware that such loans may carry significant long-term financial risks.

Over the span of several decades, amassing a loyal fanbase through his roles in crime dramas such as Magnum PI from the 1980s, Tom Selleck has showcased himself in various television commercials and YouTube advertisements that encourage individuals aged 62 and above to exchange their home equity for tax-free funds.

Over the past few months, a new series of advertisements has been repeatedly shown on television.

The text on Finance for America’s homepage says, ‘Allow your house to nurture you,’ with a picture of a man sporting a mustache in the background.

The company guarantees that funds from their loans will cover and erase monthly mortgage obligations, healthcare expenses, among other financial burdens, thereby alleviating their clients’ financial struggles.

In that popular TV commercial, the actor emphasized that a reverse mortgage loan is not a deceitful scheme intended to seize one’s house.

‘I’m proud to be part of AAG. I trust ’em. I think you can, too.’

But not everyone shares Selleck’s trust.

In 2016, the Consumer Financial Protection Bureau (CFPB) accused American Advisors Group (AAG) of misleading homeowners by deceitfully promising that they wouldn’t lose their homes if they purchased a reverse mortgage from them.

The regulatory body, currently targeted for closure by the Trump administration, imposed a fine exceeding $1 million on the company and mandated changes in their advertising tactics due to their persistent refusal to modify their marketing messages.

In 2021, the bureau once more leveled charges against the company, alleging this time that they had employed misleading tactics by presenting inflated property valuations in their promotional materials.

Advocates for consumer rights have often viewed reverse mortgages as an area ripe for fraudulent business practices and exploitative lending.

It is mentioned that roughly 10% of these cases result in default and foreclosure. This percentage significantly increased during the Great Recession and the COVID-19 pandemic, as numerous homeowners struggled to fulfill their responsibilities for maintenance, insurance, and property tax payments on their properties.

Keep in mind the potential hazards flagged by watchdogs, experts, and government consultants like those at the Federal Trade Commission, as these are crucial aspects to be aware of if you’re thinking about taking out this type of loan.

Those include costs that typically are more expensive than for regular mortgages. 

In the list, you’ll find origination fees, which for Home Equity Conversion Mortgages (HECMs), the most common type of reverse mortgage, can range from a flat fee of $2,500 or 2% of the initial value up to $200,000 of a home’s worth, whichever is more, and an additional 1% for any amount over $200,000. It’s important to note that HECMs are backed by the Federal Housing Administration (FHA).

Despite the fact that the origination fees for these specific types of reverse mortgages are limited to $6,000, the fees for other, less governed varieties of reverse mortgages may reach significantly higher amounts.

Additionally, the loans involve a primary mortgage insurance fee, usually equating to 2% of the property’s worth, along with standard real estate closing expenses – similar to what you’d find with a conventional mortgage loan.

Among the various costs involved, there are charges for credit verification, property evaluation (appraisal and inspection), as well as expenses for title research, document recording fees, and property tax payments.

Financial advisors advise against taking a reverse mortgage loan’s funds all at once, suggesting instead that the money be distributed over a specific time frame (either regularly or for as long as the borrower resides in the property) rather than receiving it as a one-time payment.

Enhancing a homeowner’s wealth might jeopardize their ability to qualify for government aid like Medicaid and Supplemental Security Income (SSI), according to specialists, because excess assets could disqualify them.

It’s essential to note that regulatory bodies warn consumers about the practice of monthly compounded interest by lenders offering reverse mortgages. This means that the amount borrowed accumulates over time, with the outstanding balance growing and having the potential to surpass the value of the property.

For homeowners looking to prevent their outstanding loan balance from growing, paying off the interest on a monthly basis is an option available to them. However, for those who find it difficult to make these payments, selling or moving might be constrained by fewer choices.

Since a reverse mortgage loan usually needs to be repaid when the borrower passes away, it can present several drawbacks for heirs. These disadvantages include inheriting less property value if the owner’s home equity has been reduced, and potentially having to cover the loan balance, accumulated interest, and related fees. This obligation often arises from the proceeds gained by selling the house.

Leaving family members such as children, grandchildren, and surviving spouses of loan recipients can find themselves in a precarious position, facing potential financial obligations and the threat of homelessness due to eviction.

Federal reforms have implemented certain protective measures. One such measure is that individuals seeking Home Equity Conversion Mortgages (HECM) are legally required to consult with a counselor approved by the Department of Housing and Urban Development, in order to fully comprehend the advantages and potential drawbacks.

Consumers can terminate their reverse mortgages within the first three days after loan closing, free from any financial charges or penalties, as a precaution against hasty lending decisions.

Most other, non-HECM reverse mortgages don’t come with such protections.

Selleck doesn’t mention the potential downsides in his paid spots for Finance of America.

 Neither Selleck nor his publicist answered the DailyMail.com’s requests for comment.

In response to our queries, Finance of America, known for selling over $17 billion in reverse mortgages, remained unresponsive as well.

As a seasoned lifestyle advisor, I must confess that reverse mortgages are not a novel concept I’m introducing to you. In fact, back in the early ’90s, I lent my voice to an intriguing AT&T advertising campaign – a testament to the versatility of my professional journey!

He extolled the virtues of homeownership in a 2012 ad campaign for Coldwell Banker. 

He made appearances in commercials for the right-leaning National Review publication and acted as a representative for the National Rifle Association, serving on their board from 2005 to 2018.

He faced strong backlash due to the timing of a questionable NRA advertisement featuring him holding a gun, just a month following the Columbine High School tragedy.

Since the 1980s, Selleck has been residing on a 60-acre ranch, previously belonging to Dean Martin, situated in Ventura County, California.

With over half a century of prosperity in Hollywood, it’s unlikely that he would require loans usually provided for individuals on fixed retirement income, who often find it challenging to cover their expenses and maintain their residences.

For fourteen years, Selleck portrayed Frank Reagan, the leader of New York City’s police department and a man whose family has been deeply involved in law enforcement for several generations, on the show Blue Bloods.

After CBS ended the series a year ago, it was recently revealed that he will feature in a fresh adaptation of the Jesse Stone collection, a detective story line derived from a set of novels.

That project is currently in development.

In 2016, he started working as a representative for Finance of America, later AAG, following the company’s search for a replacement for the late U.S. Senator from Tennessee, Fred Thompson, who was also a Law and Order star and had run for president in 2008 as a Republican.

Actors similar to those portraying hardened, rule-breaking detectives on television have also endorsed companies that offer reverse mortgages.

In the 1990s, Jerry Orbach, famously recognized for playing Detective Lennie Briscoe on Law and Order, continued his career by doing advertisements for Senior Lending Network until his passing in 2004.

As a devoted admirer, I’d like to highlight my connection with Robert Wagner. Known for his roles in Hart to Hart during the ’80s and It Takes a Thief in the ’60s, he also took on a different role as a representative for that company in 2012 and 2013.

In 2013, I lent my clean-cut reputation, similar to that of Pat Boone, to endorse reverse mortgages for Security 1 Lending. Just two years ago, AmeriVerse Mortgage capitalized on the righteous image of Bill Medley from The Righteous Brothers to promote their products.

Henry Winkler, famously known for his role as Arthur ‘Fonzie’ Fonzarelli in the popular ’70s sitcom Happy Days, was consistently featured in advertisements promoting One Reverse Mortgage, a division of Quicken Loans, between 2012 and 2018.

For those baby boomers who grew up idolizing his rebellious charm, a piece of advice: It’s hip to use the equity in your home to finance your golden years.

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2025-03-25 19:14

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