Sun-Times: Jesse Jackson Intervenes in Reverse Mortgage Default

Civil rights activist Jesse Jackson threw his influence into a Chicago reverse mortgage foreclosure case involving a 97-year-old reverend and community leader, according to a column in Tuesday’s Chicago Sun-Times.

The Rev. Helen Sinclair, known locally as “Queen Mother,” received a foreclosure judgment from Wells Fargo in January, Sun-Times columnist Mary Mitchell reported. Sinclair, a former prison chaplain who continues to visit with inmates across Illinois, took out a reverse mortgage on the Bronzeville home where she has lived since childhood, but faced trouble paying the taxes and insurance during her more than five years with the loan.

According to Sinclair, she worked out a repayment plan with lender Wells Fargo, which had been forced to cover her missed obligations. But when she couldn’t meet the repayments, Wells Fargo moved to foreclose on the property, taking out public notices in the local Hyde Park Herald on three dates in April.


Sinclair claims she was unaware that the bank could move to foreclose on her property. The nonagenarian served as the executive director of the prison ministry at Jesse Jackson’s Rainbow/PUSH Coalition organization, and the civil rights leader and Chicago fixture told the Sun-Times that he planned to reach out to Wells Fargo and help prevent Sinclair from losing her home.

“She’s an outstanding community servant who has helped people for so long,” Jackson told the paper. “I’m definitely going to call the bank on her behalf.”

Wells Fargo has since delayed the action, and a bank spokesman indicated that the company will attempt to reach an alternate solution to the problem. The San Francisco-based banking giant exited the Home Equity Conversion Mortgage business in 2011, having previously ranked as the largest reverse mortgage lender in the country.

Chicago has seen its share of bad reverse mortgage headlines in recent years: Just last summer, businessman Mark Diamond was ordered to pay a $2.4 million settlement after he allegedly convinced more than 30 homeowners on the city’s south and west sides to take out reverse mortgages, then give him the proceeds to perform home repairs — work that turned out to be shoddy or incomplete, according to the Illinois attorney general’s office. As recently as this March, many of the homeowners who worked with Diamond — primarily older African-Americans — had yet to receive the settlement money, according to the Chicago Reporter. 

The scandal also prompted Land of Lincoln lawmakers to pass the Reverse Mortgage Act in 2015, which instituted a three-day “cooling-off” period for borrowers and empowered the state to create its own HECM educational materials.

Mitchell’s column in the Sun-Times reflects the confusion and anger toward reverse mortgage lenders in Chicago and its surrounding suburbs.

“I’m confident that Sinclair’s situation will be resolved, but what about the population of aging boomers just waiting to be picked off by lenders?” Mitchell asks rhetorically, citing a 2015 Consumer Financial Protection Bureau study that revealed many seniors still don’t understand HECMs, despite growing coverage in the media and state-mandated educational counseling sessions.

“Sinclair is hoping that other seniors will pay better attention to what reverse mortgages are, and not take the word of actor Tom Selleck,” Mitchell’s column concludes, referring to the latest TV spokesman for industry leader American Advisors Group.

Written by Alex Spanko

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  • About a year later than the HECM origination was made to Ms. Sinclair, two originators rose up to attack a CPA who was warning the industry that fixed rate Standards originated as blatantly as they were would soon take their toll on the MMI Fund. Two originators, one from Hawaii and the other from Chicago rose up to say they disagreed and believed Fixed Rate Standards were the only products seniors wanted. The CPA cited the value of the line of credit recommending it as a great way to avoid the negative arbitrage that he was seeing seniors suffer who had invested their excess proceeds from fixed rate Standards.

    The Chicago originator angrily stated that the line of credit only confused seniors and that in the last two years all he had originated were fixed rate Standards and never once was even he asked about anything else. Then he attacked the CPA saying that the CPA was “steering” seniors into a poor decision and that he was in fact was giving seniors what they wanted and thus was the largest HECM producer at his firm.

    What is it about Chicago and reverse mortgages? The Chicago originator had a degree in secondary education from of all places Northwestern University.

  • What a bunch of crap!

    Once again, the client does not meet the obligations of being a homeowner and somehow this is due to the particular mortgage she has on the property.
    When will the reverse mortgage industry stand up and stop being the whipping boy of the financial industry?

    When you own a home in this great Country you have to pay your real estate taxes! When you fall behind on those taxes most banks work with you to arrange a work out plan for you. As Wells Fargo did in this case.

    When you then fail to keep your payment arrangements that the bank was nice enough to give you, you are in DEFAULT.

    It has nothing to do with the type of mortgage you currently have on your home!!! It has nothing to do with that mean loan officer!

    It does have to do with personal responsibility!!!

    If this was a forward loan wouldn’t the same thing be happening???

    And here come Jesse Jackson, to protect this person who did not meet the obligations that every homeowner in America must meet!

    Sorry for the rant my reverse mortgage brothers and sisters but let’s stop taking this crap!!!

    • I agree with you – they seem to insinuate or outright say that blame lies with Wells Fargo, Tom Selleck and the program itself. Between the mandatory counseling, including a quiz that takes place, all the clearly spelled out paperwork they sign and the loan officer’s guidance (assuming they’re not a bad apple) there is absolutely no way borrowers don’t know you have to pay your taxes or the loan eventually defaults. It is also just plain common sense. I don’t see it addressed how Rev Jackson plans on helping her increase her monthly income so she can pay her taxes. If she can’t pay her taxes, how is she paying for other things? I’m sure Wells Fargo will bend over because they don’t want the bad PR regardless if it’s deserved, but they really shouldn’t. Sets a bad precedent.

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