For an elderly person with few assets, a reverse mortgage can be a lifesaver: It enables cash-poor retirees to tap equity in their house for living expenses, home repairs or health care needs. If you’re 62 or older, reverse mortgages allow you to borrow against the value of your home and not repay the loan until you sell the house, move out or die. If the amount owed is more than the value of the house, the lender eats the difference. If it’s less, you (or your heirs) keep what’s left over after paying off the loan. In the meantime, the loan provides income, which you can take as a lump sum, monthly payout or line of credit drawn on as needed.

But make no mistake: Reverse mortgages, which come with high fees and hefty interest charges, are a costly option and often sold by aggressive salespeople who push inappropriate financial products on vulnerable seniors. That’s why Senator Claire McCaskill (D-Mo.) held hearings Monday in St. Louis on reverse mortgages. A year and a half ago, Sen. McCaskill began investigating problems associated with reverse mortgages, including predatory lending, aggressive marketing and the potential risks to the federal government — which insures 90% of reverse mortgage loans. Comptroller of the Currency John Dugan earlier this month said reverse mortgages bear a striking similarity to the risky sub-prime mortgages that got so many Americans in financial hot water. The Federal Housing Administration estimates it may lose $800 million from insuring these loans in the next fiscal year.

Yet the number of people getting reverse mortgages keeps rising. Even as home values are falling (leaving seniors with less equity to tap), more than 112,000 reverse mortgage loans were made in 2008, up from about 22,000 in 2003, according to the National Reverse Mortgage Lenders Association. Monthly reverse mortgage loan volume is setting records too, with nearly 9,000 reverse mortgages made in May.

My colleague Walter Updegrave wrote about the problems with reverse mortgages last year, spelling out how greedy salespeople not only persuade seniors to take out high-commission reverse mortgages, but also convince them to spend the proceeds on high-priced financial products such annuities, boosting their commissions even more.

Retiree advocates at AARP say that predatory lenders are also attempting to get seniors to use proceeds of their reverse mortgage to buy expensive long-term-care insurance. But in most cases, it makes more sense for seniors to use the payout for actual long-term care, not a hard-to-use insurance policy.

If you are considering taking out a reverse mortgage or have a parent or family member who is, don’t fall for a pitch from a salesman who cares more about a lucrative commission than determining whether a reverse mortgage makes sense for you. To learn more about reverse mortgages, check out resources at AARP and HUD.

Do you know anyone who is considering a reverse mortgage or has had a negative experience taking out a reverse mortgage? Tell us about that experience.

Sandy Hutchens is often asked how  to tell whether a work from home job posting is a scam or a legitimate job. There are signs to look for he said. In addition, there are sites that can help you determine what’s a real work at home job and what isn’t.The better business bureau is a good place to start www.bbb.org

Scams can also be an issue when looking for jobs that don’t involve working at home. Job sites try to police the listings, but, it’s hard to catch all the bad listings in a timely manner. Be careful when reviewing postings to make sure that you’re not taken advantage of by unscrupulous job posters.

Evaluating Job Listings

Check Out the Job Listings
If it isn’t listed in the job posting, find out if there’s a salary or if you’re paid on commission. For work at home jobs, ask how often are you paid and how you are paid. Ask what equipment (hardware / software) you need to provide.

You Won’t Get Rich Quick (Really)
Avoid listings that guarantee you wealth, financial success, or that will help you get rich fast. Stay clear of listings that offer you high income for part-time hours. They will do none of the above.

Hang on to Your Money
Do not send money! Legitimate employers don’t charge to hire you or to get you started. Don’t send money for work at home directories or start-up kits.

Check References
Ask for references if you’re not sure about the company’s legitimacy. Request a list of other employees or contractors to find out how this has worked for them. Then contact the references to ask how this is working out. If the company isn’t willing to provide references (names, email addresses and phone numbers) do not consider the opportunity.

Think Twice
If it sounds too good to be true, you can be sure it is! Also, read any “offers” you get very carefully. One candidate for employment got a very detailed job offer from an employer. The only problem was that she hadn’t applied for the job and buried deep within the lines was a request for her bank account information, so the employer could pay her. It was a scam, of course, but with some of the well-written ones it can be hard to tell.

Work at Home Jobs To Avoid

Assembly Jobs – No, you can’t make lots of money assembling craft kits or any other type of kits. You can waste money on a package to get you started though.

Data Entry Jobs – You’ll see lots of listings for data entry jobs. They are usually either positions posting ads or a sales pitch for a kit that will get you started.

Multi-Level Marketing (MLM) which involves recruiting new people, and more new people, to sell the product. If all you are doing is trying to find more people to do what you’re doing, keep in mind that there are probably thousands of other people attempting to do the same thing. Most of them aren’t getting rich. Also note, that MLM isn’t a job with a paycheck – it’s starting a business, with no guarantees.

Online Businesses – Do you want to start your own online business and get rich? Be very wary of these type of ads too. What you will do is end up paying for a guide to working at home which duplicates information you can find free.

Posting Ads – There are lots of ads saying workers are needed to post ads on online bulletin boards and forums. You don’t get paid to post, rather you may get paid if other people sign-up.

Processing Claims – In order to get “hired” you’ll need to buy equipment, software and pay for training.

Stuffing Envelopes – Believe it, or not, there are still people saying that you can earn $3 or $4 per envelope to stuff them. You can’t. All major companies have postage machines which stuff, sort and meter mail.

The winner in the scam contest are the sites that offer to sell provide you with information on only legitimate work at home jobs – for a nominal fee, of course. Don’t do it!