Posted by Rona Fischman on Boston.com Legal Issues

Sam Schneiderman, Broker-owner of Greater Boston Home Team is our Monday guy. Today he discusses what to expect when making or receiving a real estate offer.

Whether it is a short sale, lender owned property (REO) or market sale; there seem to be many different ideas about how buyers should submit offers and how sellers should respond to offers. Today, I want to clarify some of the rules of engagement for buyers and sellers in the Greater Boston market.

Here are the most common misconceptions that I hear from buyers, sellers and agents:

All offers must be in writing.

WRONG. A buyer can make a verbal offer to a seller and a seller can respond verbally to a buyer’s offer. The important thing to know is that in Massachusetts the final deal must be in writing and signed by both parties or it is not enforceable. (Many agents and sellers won’t get involved with verbal offers for that reason.)

 Counter-offers must be in writing to be valid.

WRONG. The same rules that apply to offers apply to counter-offers. (If a seller puts a counter–offer in writing, he/she may not be able to accept other offers while the counter-offer is still active.)

 If the seller receives a full price offer from a buyer, the seller must accept the offer.

WRONG. When a seller puts a property up for sale, the seller is soliciting offers from potential buyers. The seller is free to consider any and all offers and to select the one(s) that he/she would like to accept or counter-offer as long as he/she doesn’t discriminate against buyers with his/her actions.

If more than one offer is received, the seller must negotiate with the first person that presents an offer.

WRONG. See the answer above

The offer must be accompanied by a check for a certain amount as a “good faith” binder.

WRONG. Amounts are customary in many markets, but any reasonable amount should bind an offer.

 Offers must be good for a specific amount of time in order to give the seller a chance to respond.

WRONG. Offers can be written for as long or short a time as the buyer wishes. (If the offer is on a short sale, the offer may need to be even longer in some cases.)

Answer: That is a very good question. Actually, it’s one that most people ask during the initial consultation. Here is a well written article directly on point:

By Douglas Jacobs, California Bankruptcy Attorney

Not really.  The greatest effect on your Credit Score (Fico score) Is the number of late payments on your accounts.  More late payments – worse scores.  Certainly there are other factors, and filing bankruptcy may have the immediate effect of lowering the score.

But why do you care?  That’s the truly important question.

First of all, if you have months of missing credit card or house payments, your  credit score is none too good at the moment. Filing bankruptcy won’t hurt it that much.  And it will give you a fresh start – a clean slate to build your credit back from where it is and in far less time than it takes struggling to pay off those credit cards.

Secondly, and most importantly, let’s look at the advantages of having good credit.  What will it do for you?  Well, you can qualify to buy a new home. But you still have to prove you can make the payments on that home and that is far more important to lenders than your credit score.

And with a good score, you will  be able to  qualify for the deals on television to buy a car with nothing down or a terrific interest rate.  Wow, a great thing! But what does it really mean?  Let’s suppose you want to buy and finance a $30,000 automobile.  Even with bad credit score the car company will probably still sell you the vehicle; they’ll just charge you two or three times the interest rate of someone with good credit.

So, let’s look at an example.  If the special interest rate for “good credit” is 3%, then on a $30,000 loan spread over 5 years, you will pay $2343.64 in interest.  If you don’t qualify for that rate and end up at 7% interest you’ll pay $5642.16 in interest.  Thus, having good credit will save you $3299 over five years.

When you compare that savings to the credit card and other debts going away by filing bankruptcy, having bad credit for a couple of years is clearly the better of the two!

The changes include new rules for the following: van-accessible parking, maximum height and “reach ranges” for certain objects, service animals, communication devices for the hearing-impaired, seating requirements in theaters and other assembly areas (including access to stages), pool access, hotel reservations, wheelchair accessibility for employees, the use of mobility devices other than wheelchairs (such as Segways), and more.

In addition, the U.S. Justice Department has updated its list of modifications that all building owners are expected to consider, including ramps, curb cuts, access to vending machines, widening doors, accessible door hardware, rearranging toilet partitions, grab bars and raised toilet seats, and insulating pipes under sinks to prevent burns.

Higher standards are required for new construction and for older properties that are undergoing substantial renovations.

Exactly what is required varies and depends on the nature of the property and the expense involved in making it more accessible, but all commercial property owners need to be aware that new requirements are taking effect soon.

The Massachusetts real estate attorneys concentrate in Massachusetts real estate law and serve the entire Greater Boston North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, and Swampscott. Our real estate lawyers speak and provide legal services in Spanish and Italian.

Auctions often attract buyers who are looking for a deal – although auctioned properties are usually sold “as is” with no guarantees, so unless you’ve done careful homework and had everything inspected thoroughly, the property might not be as good a deal as you first thought.

Auctions require special contracts and agreements that aren’t part of a traditional real estate transaction.

Because auctions are unusual and require special contracts and agreements, a seller will definitely want to work with an attorney as well as an auctioneer.

The first contract is between the seller and the auctioneer. This should include the auctioneer’s compensation and any specific requirements such as a minimum price, deed restrictions, or a seller’s veto power over the auctioneer’s advertising materials.

The seller will then prepare an information package for bidders. This should include any documents the buyer will be required to sign at closing, such as a purchase agreement. Typically, the purchase agreement won’t include any contingencies. The buyer will be expected to have lined up financing in advance, and to have made any inspections of the property prior to the auction date.

The buyer may also be warned that he or she will be expected to put up a non-refundable deposit when the agreement is signed.

Buyers may want the information package to include a title commitment, an environmental report, or other documents.

Sometimes buyers will be asked to sign a confidentiality agreement saying that they won’t disclose the information in the package to anyone else. Buyers might also be asked to sign an indemnity agreement, saying the seller is off the hook if the buyer damages the property or suffers an injury during an inspection.

Finally, the package should provide information on price. If it’s an absolute auction, then the highest bidder will get the property, even if the bid is one dollar. The seller may also require a minimum bid; if no one makes the minimum bid, then the property won’t sell. Sometimes sellers set a “reserve,” which is a minimum bid that’s kept secret. Bidders don’t know what the reserve amount is, but if no one bids that much, then all bids are turned down and the property is not sold.

The Boston North Shore real estate attorneys concentrate in Massachusetts real estate law and serve the entire Greater Boston North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, and Swampscott. Our real estate lawyers speak and provide legal services in Spanish and Italian.

A federal estate tax return doesn’t have to be filed every time someone dies. In fact, most estates never have to file one. In 2011 and 2012, a return has to be filed only if the person’s estate (including property, life insurance, taxable gifts, etc.) is worth $5 million or more.

However, even if a return isn’t required, a recent change in the law means there could be big tax savings for many families if they file one anyway.

The change applies to estates of people who die in 2011 or 2012 and are survived by a spouse.

There are strict time limits for filing a return, so if you know of someone whose family could take advantage of these savings, you or they should speak with an attorney right away.

Also, if you have an older will that includes a trust designed to reduce taxes when a surviving spouse later dies, you should have the will reviewed, because under the new law there might now be better alternatives.

How it works

Generally, when a person dies, his or her estate can give an unlimited amount to a surviving spouse. After that, if the person’s bequests (plus large lifetime gifts) total more than a certain “exemption amount,” then an estate tax is due. For 2011 and 2012, the exemption amount is $5 million.

Traditionally, the exemption amount applied separately to each spouse. So if a husband died first, his estate could use the exemption amount, and when his wife died later, she would get her own exemption amount.

But under a change in the law starting in 2011, if the first spouse to die doesn’t use all of his or her exemption amount, the difference can be passed along to the other spouse. So suppose a husband dies and doesn’t use any of his $5 million amount (because he leaves everything to his wife). When the wife dies, her exemption amount will be her own $5 million plus the $5 million that the husband didn’t use. So instead of being able to leave $5 million tax-free to her heirs, she can leave $10 million tax-free – a potential savings of millions of dollars.

However, this only works if the husband’s estate filed an estate tax return and elected to pass the exemption amount on to his wife. If the husband’s estate didn’t file a return (because it wasn’t legally required), then all the potential tax savings are lost.

This means that it’s almost always a good idea to file an estate tax return for anyone who dies in 2011 or 2012, if they are survived by a spouse.

Even if it seems highly unlikely that a surviving spouse will be worth more than $5 million when he or she dies, it’s still a good idea to file a return, because the $5 million exemption amount only lasts through 2012. After that, Congress can change it, and we don’t know what amount Congress will choose. It appears that if Congress doesn’t do anything, the amount will be reduced to just $1 million in 2013.

Because the current law only lasts through 2012, there are a lot of questions and uncertainties about what will happen after that. It’s possible that the law will change again, and the tax savings may be reduced or lost by the time the surviving spouse dies. However, in most cases, the cost of filing an “unnecessary” tax return will be small compared to the potentially huge savings down the road.

(In a few cases, executors might be put in an awkward position because the heirs who would have to pay for filing the return might be different from those who would benefit from the increased exemption. In such a case, the executor might want to ask the surviving spouse to pay the cost of the filing, since he or she will benefit from it.)

Many wills need to be reviewed

In the past, many people tried to achieve a similar result – using both spouses’ exemptions – through the use of a trust, sometimes called a “bypass trust.” Typically, when the first spouse died, some of his or her assets (often a sum equal to the current exemption amount) went into a trust, and the rest was left directly to the surviving spouse. The trust might pay income and principal to support the spouse during his or her lifetime, after which the assets would go to children or other heirs. When the surviving spouse died, the trust property wasn’t included in his or her estate, and so it didn’t “count” toward the exemption amount.

A new law means that it’s almost always a good idea to file an estate tax return for anyone who dies in 2011 or 2012, if they are survived by a spouse.

The new law might make these kinds of bypass trusts unnecessary for some people – at least until the end of 2012.

You might want to consider the costs and benefits of eliminating such a trust from your will, or at least providing that the trust provisions won’t take effect unless the law changes again such that the trust becomes a good idea.

Some of the disadvantages of a bypass trust include:

• The surviving spouse has less flexibility and access to the assets.
• There are expenses in managing the trust, filing trust tax returns, and sometimes hiring an outside trustee.
• If trust property is sold after the surviving spouse dies, the “basis” for capital gains tax purposes is its value at the time of the first spouse’s death – whereas without a trust, the basis would be the (presumably higher) value at the time of the second spouse’s death.

On the other hand, there are some powerful reasons to keep a bypass trust. For instance:

• Assets in such a trust will be protected from a surviving spouse’s creditors, and from the actions of a future spouse if the surviving spouse remarries.
• A spouse might want to put property in a trust to make sure that when the surviving spouse dies, the assets will go to the person’s children from a prior marriage.
• A bypass trust can also reduce state estate taxes, as well as generation-skipping transfer taxes.
• A bypass trust shields all future appreciation from estate taxes – even if the assets in the trust grow in value far beyond the amount of the first spouse’s exemption.

As an aside, if your old will says that the amount that will go into a bypass trust is equal to the exemption amount, you might want to review this in light of the fact that the exemption amount in 2011 and 2012 has been dramatically increased to $5 million. You might prefer to say that the trust assets will be the exemption amount or a certain dollar figure, whichever is less.

Remarriage

One final note: If a surviving spouse “inherits” the other spouse’s unused exemption, it’s not clear what happens if the spouse remarries. While the law is confusing, it appears that if the spouse remarries and then the new spouse dies first, the unused exemption from spouse #1 is wiped out, and the spouse is limited to any unused exemption from spouse #2.

This is something that spouses who are considering remarrying will want to take into account in their estate planning. The issue of “inherited” exemptions is also something that they might want to specifically provide for if they are going to sign a prenuptial agreement.

Our estate planning attorneys concentrate in estate planning matters and serve the Greater Boston and Boston’s North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, Swampscott, Middlesex County and Essex County, Massachusetts.

How Long After Filing Bankruptcy Can You Buy A Home?
by Jay Fleischman, New York Bankruptcy Lawyer

Buy a home after bankruptcy?  Seems like a stretch for all but those who win the lottery once the discharge is issued.  But play your cards right and you could be worrying about scheduling a closing date sooner than you ever thought possible.

After filing bankruptcy, you’re debt free.  No more calls, no more lawsuits.  Suddenly, the world feels a bit brighter and filled with possibilities.  You start looking around your rental and thinking you might want to buy a home.

In order to buy a home after filing bankruptcy, you’re going to need to worry about two things.  They are:

1. Your level of savings; and
2. Your credit score.

Your Savings Account (The Downpayment)

In order to buy a home, you must have a downpayment.  Though the land of $0 down mortgages was wonderful for a time, it’s gone now.  And if there’s a broker willing to do the deal for you, run the other way.  When you don’t have a downpayment, you run the risk of going upside down on your mortgage the first time the Federal Reserve Bank chairman catches the sniffles.  Definitely bad idea.

Spend the first year or so after filing bankruptcy focusing on your savings account.  Sock away every spare dollar, and then some.  Cut your cable or satellite television, consider ditching the landline phone in favor of the cell, and turn off your lights when you leave the room to save on electricity.

 Clip coupons.  Lots of them.

If you can, grow something useful in the garden rather than pretty flowers that can’t feed you.

If you want to buy a home, you need money.  Lots of it.  Save every dollar you can.

 Your Credit Score

Going through bankruptcy will hit your credit score to the tune of about 150 points. Doesn’t sound like a lot, but when you remember your credit score tops out at 850 and seldom goes below 400 unless you’ve somehow lost your pulse, it’s pretty big.

You’re going to want to get to work on repairing the damage, and fast.

First thing to remember is that you must continue to pay your debts on time. If you’ve got student loans or a car loan, make those payments without fail. The student lender will report that positive payment stream, though the car lender may not unless you reaffirmed the debt. No reaffirmation? No problem – just keep copies of the canceled checks and ask the finance company for a payment history before you go to the mortgage broker.

Next is that different mortgage companies may look to different credit reporting agencies – each of which may list different obligations. Some may list your utility payments, others may have the rent bill to the landlord. Keep on top of it all after filing bankruptcy to maximize the chances you can buy that dream home. You also want to check your credit reports after bankruptcy to make sure they reflect your debt-free world.

Finally, consider a single credit card after bankruptcy. Use it every month, then pay it off over a 2-month period to ensure that the payments show up on your credit report. That’s going to raise your score as well.

You can buy a home after filing bankruptcy, but the upshot is that you need to take some time to build yourself back up. Don’t rush it – Rome wasn’t built in a day. With hard work, however, you’ll get there just fine.

Jay S. Fleischman is a bankruptcy lawyer who helps people fight back against debt collection harassment.

The first step is to serve a fourteen day notice to quit for non-payment of rent. The fourteen days runs from the time that the notice is served upon the tenant. After fourteen days have passed (expiration date), the next step is to serve a summary process summons and complaint upon the tenant by the first Monday after the 14 day Notice to Quit expires. Thereafter, the complaint with proof of service must be filed with the court no later than the second Monday after the expiration of the 14 day Notice to Quit. The tenant has until the following Monday (being the third Monday after the expiration of the 14 day Notice to Quit) to file an Answer with the court. If the tenant fails to file an Answer, the hearing will most often times be the third Thursday after the expiration of the Notice to Quit. If the tenant files an answer, the hearing is postponed by two weeks. In total it takes a minimum of five weeks to get into court after the tenants fails to pay their rent.

If you are evicting a tenant for no cause, such as in cases were the tenant is month to month, it takes longer to get into Court. The tenant is entitled to a thirty day notice to quit, which must be served before the next rental period. So for example if you want to serve a tenant on April 1 to vacate by May 1 the tenant must be served no later than March 31. Thereafter it is similar to the time line above and takes about an additional three weeks to get into court. In total in no fault types of eviction it takes a minimum of about seven weeks to get into court or more, depending on when the Notice to Quit is served.

Choosing the proper Notice to Quit and strict adherence to the Court filing procedure is critical to having your case heard in a timely manner.  Any error could cause you to restart the process and double time necessary to evict your tenant.   For assistance with your Landlord/Tenant matter, please contact us for a free consultation.

Ordinarily, you can give up to $13,000 each year to as many people as you like without paying gift tax. Through the end of 2012, you can also make total lifetime gifts in addition to these amounts of up to $5 million. You won’t have to pay gift tax on these additional lifetime gifts, although they will reduce your estate tax exemption when you die.

That means that if you make gifts before the end of 2012 of up to $5 million (such as, for instance, gifts to trusts that will benefit your children), it will have a neutral effect on your federal estate tax – your estate won’t owe more or less as a result.

By making lifetime gifts rather than bequests in a will, you may be able to lower or even eliminate the amount of state estate taxes that will be owed.

However, it can have a very positive effect on your state estate tax. By making lifetime gifts rather than bequests in a will, you’ll reduce the amount of your taxable estate, which can lower or even eliminate the amount of state estate taxes that will be owed.

Our inheritance tax attorneys concentrate in estate planning matters and serve the Greater Boston and Boston’s North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, Swampscott, Middlesex County and Essex County, Massachusetts.

Home appraisers are the unofficial umpires of residential real estate sales, deciding whether offering prices are fair or foul. But much more often than in the past, they’re striking out deals and sending buyers and sellers back to the dugout. Each month, between 10 and 20 percent of real estate agents are seeing accepted offers to buy a home founder or collapse as a result of appraisals that came back too low, according to recent surveys by the National Association of Realtors.

Low appraisals hurt both buyers and sellers. When an appraisal comes back lower than expected, buyers usually can’t qualify for as large a mortgage. That means they have to put up a larger down payment to buy the house – something they often can’t do. As a result, the sale might fall through, or the seller will have to lower the price in order to salvage the deal.

There are ways to improve your chances of a good appraisal. But first, it’s important to know why this problem has arisen lately.

During the height of the real estate boom, real estate agents and mortgage brokers often played a big role in selecting appraisers. These agents and brokers had a strong interest in high appraisals, because a high appraisal meant that it would be easier to get a deal to go through. So many appraisers felt pressured to turn in optimistic numbers, fearing that if they didn’t, they wouldn’t be hired again in the future.

Arguably, this resulted in a rash of unreasonable valuations, which contributed to the housing bubble.

As a result, two years ago the federal agencies that control the bulk of residential mortgages, such as Fannie Mae, barred real estate agents and mortgage brokers from choosing appraisers.

This spawned a new industry, called “appraisal management companies,” or AMCs, which hire appraisers to provide independent valuations to lenders. Today, about 70 percent of appraisals are done through AMCs; most of the rest are done by in-house appraisers who work directly for banks.

Some appraisers think this is a good thing, because they can be objective and are no longer under pressure to skew the numbers upward.

On the other hand, some appraisers say they now have the opposite problem – they feel pressure to skew the numbers downward and to be as conservative as possible, out of fear that they’ll get in trouble if a high appraisal leads to a bad loan and a default.

Some appraisers say they feel pressure to skew the numbers downward and to be as conservative as possible, out of fear that they’ll get in trouble if a high appraisal leads to a bad loan and a default.

Other critics say that AMCs have resulted in lower-quality appraisals. Because AMCs keep a lot of the money that used to go directly to the appraiser, appraisers receive less compensation for each job, and thus they have to look at more properties in less time in order to make the same income. As a result, critics say, appraisers don’t make as careful an inspection as they might, and don’t give as much thought to whether the “comparable sales” they use for valuation truly involve comparable properties.

Some appraisers complain that in order to increase their volume, they have to accept jobs outside their local area, where they are unfamiliar with the neighborhoods and less able to make informed judgments about comparable sales.

What you can do

With home appraisals now presenting a much higher hurdle than in the past, here are some suggestions for getting a good result:

• Treat the appraisal as a “second sale.” Just as you fixed your home up to look nice for an open house, you’ll want it to look nice for an appraiser, too. It’s not necessary to make your house spotless or to have fresh flowers on the table, but it’s a good idea to mow the lawn, trim the hedges, remove marks from walls and clean soiled carpets. All these things will factor into the appraiser’s “condition” rating for the home.

• Make a list of all the improvements you have made to the property, and give it to the appraiser. Include the date and the cost, or an estimate if you don’t have the exact figure. Include even small upgrades and maintenance. It’s particularly important to include items that might not be obvious on a brief inspection, such as new insulation or a new roof.

• Also tell the appraiser about any recent major improvements to the neighborhood, such as a new school building or park.

• Fix any peeling paint. This is especially important if the house was built before 1978 (when lead paint was banned) and the buyer is using an FHA mortgage, because the agency will require the paint to be removed before approving the loan.

• If you can, give the appraiser your own list of recent comparable sales. The appraiser will do his or her own homework, but providing a list can’t hurt, especially if you highlight truly comparable properties with good sale prices. Two things are especially important: (1) If you know of any homes in the area that were “for sale by owner” (with no real estate agent involved), and that fetched a good price, tell the appraiser because these sales probably won’t show up as quickly in the appraiser’s database. (2) If any comparable properties in the area were recently sold as short sales or foreclosure sales, let the appraiser know. These types of sales generally result in lower prices, and if the appraiser knows the circumstances behind the sale, he or she might be able to adjust the valuation upward.

• Finally, be considerate of the appraiser. Most appraisers like to go through a house uninterrupted, so don’t follow around too closely and save your questions for the end. You might also want to keep small children and dogs out of the way.

The Massachusetts real estate attorneys concentrate in Massachusetts real estate law and serve the entire Greater Boston North Shore region including the communities of Everett, Revere, Chelsea, Somerville, Cambridge, Medford, Arlington, Winchester, Woburn, Burlington, Stoneham, Melrose, Wakefield, Saugus, Lynn, Peabody, Salem, Marblehead, and Swampscott. Our real estate lawyers speak and provide legal services in Spanish and Italian.

1. Health Care/Medicare/Health Insurance Fraud

Every U.S.citizen or permanent resident over age 65 qualifies for Medicare, so there is rarely any need for a scam artist to research what private health insurance company older people have in order to scam them out of some money.

In these types of scams, perpetrators may pose as a Medicare representative to get older people to give them their personal information, or they will provide bogus services for elderly people at makeshift mobile clinics, then use the personal information they provide to bill Medicare and pocket the money.

2. Counterfeit Prescription Drugs

Most commonly, counterfeit drug scams operate on the Internet, where seniors increasingly go to find better prices on specialized medications.

This scam is growing in popularity—since 2000, the FDA has investigated an average of 20 such cases per year, up from five a year in the 1990s.

The danger is that besides paying money for something that will not help a person’s medical condition, victims may purchase unsafe substances that can inflict even more harm. This scam can be as hard on the body as it is on the wallet.

3. Funeral & Cemetery Scams

The FBI warns about two types of funeral and cemetery fraud perpetrated on seniors.

In one approach, scammers read obituaries and call or attend the funeral service of a complete stranger to take advantage of the grieving widow or widower. Claiming the deceased had an outstanding debt with them, scammers will try to extort money from relatives to settle the fake debts.

Another tactic of disreputable funeral homes is to capitalize on family members’ unfamiliarity with the considerable cost of funeral services to add unnecessary charges to the bill.

In one common scam of this type, funeral directors will insist that a casket, usually one of the most expensive parts of funeral services, is necessary even when performing a direct cremation, which can be accomplished with a cardboard casket rather than an expensive display or burial casket.

4. Fraudulent Anti-Aging Products

In a society bombarded with images of the young and beautiful, it’s not surprising that some older people feel the need to conceal their age in order to participate more fully in social circles and the workplace. After all, 60 is the new 40, right?

It is in this spirit that many older Americans seek out new treatments and medications to maintain a youthful appearance, putting them at risk of scammers.

Whether it’s fake Botox like the one inArizonathat netted its distributors (who were convicted and jailed in 2006) $1.5 million in barely a year, or completely bogus homeopathic remedies that do absolutely nothing, there is money in the anti-aging business.

Botox scams are particularly unsettling, as renegade labs creating versions of the real thing may still be working with the root ingredient, botulism neurotoxin, which is one of the most toxic substances known to science. A bad batch can have health consequences far beyond wrinkles or drooping neck muscles.

5. Telemarketing

Perhaps the most common scheme is when scammers use fake telemarketing calls to prey on older people, who as a group make twice as many purchases over the phone than the national average.

While the image of the lonely senior citizen with nobody to talk to may have something to do with this, it is far more likely that older people are more familiar with shopping over the phone, and therefore might not be fully aware of the risk.

With no face-to-face interaction, and no paper trail, these scams are incredibly hard to trace. Also, once a successful deal has been made, the buyer’s name is then shared with similar schemers looking for easy targets, sometimes defrauding the same person repeatedly.

Examples of telemarketing fraud include:

“The Pigeon Drop”

The con artist tells the individual that he/she has found a large sum of money and is willing to split it if the person will make a “good faith” payment by withdrawing funds from his/her bank account. Often, a second con artist is involved, posing as a lawyer, banker, or some other trustworthy stranger.

“The Fake Accident Ploy”

The con artist gets the victim to wire or send money on the pretext that the person’s child or another relative is in the hospital and needs the money.

“Charity Scams”

Money is solicited for fake charities. This often occurs after natural disasters.

6. Internet Fraud

While using the Internet is a great skill at any age, the slower speed of adoption among some older people makes them easier targets for automated Internet scams that are ubiquitous on the web and email programs.

Pop-up browser windows simulating virus-scanning software will fool victims into either downloading a fake anti-virus program (at a substantial cost) or an actual virus that will open up whatever information is on the user’s computer to scammers.

Their unfamiliarity with the less visible aspects of browsing the web (firewalls and built-in virus protection, for example) make seniors especially susceptible to such traps.

One example includes:

Email/Phishing Scams

A senior receives email messages that appear to be from a legitimate company or institution, asking them to “update” or “verify” their personal information. A senior receives emails that appear to be from the IRS about a tax refund.

7. Investment Schemes

Because many seniors find themselves planning for retirement and managing their savings once they finish working, a number of investment schemes have been targeted at seniors looking to safeguard their cash for their later years.

From pyramid schemes like Bernie Madoff’s (which counted a number of senior citizens among its victims) to fables of a Nigerian prince looking for a partner to claim inheritance money to complex financial products that many economists don’t even understand, investment schemes have long been a successful way to take advantage of older people.

8. Homeowner/Reverse Mortgage Scams

Scammers like to take advantage of the fact that many people above a certain age own their homes, a valuable asset that increases the potential dollar value of a certain scam.

A particularly elaborate property tax scam inSan Diegosaw fraudsters sending personalized letters to different properties apparently on behalf of theCountyAssessor’s Office. The letter, made to look official but displaying only public information, would identify the property’s assessed value and offer the homeowner, for a fee of course, to arrange for a reassessment of the property’s value and therefore the tax burden associated with it.

Closely related, the reverse mortgage scam has mushroomed in recent years. With legitimate reverse mortgages increasing in frequency more than 1,300% between 1999 and 2008, scammers are taking advantage of this new popularity.

As opposed to official refinancing schemes, however, unsecured reverse mortgages can lead property owners to lose their homes when the perpetrators offer money or a free house somewhere else in exchange for the title to the property.

9. Sweepstakes & Lottery Scams

This simple scam is one that many are familiar with, and it capitalizes on the notion that “there’s no such thing as a free lunch.”

Here, scammers inform their mark that they have won a lottery or sweepstakes of some kind and need to make some sort of payment to unlock the supposed prize. Often, seniors will be sent a check that they can deposit in their bank account, knowing that while it shows up in their account immediately, it will take a few days before the (fake) check is rejected.

During that time, the criminals will quickly collect money for supposed fees or taxes on the prize, which they pocket while the victim has the “prize money” removed from his or her account as soon as the check bounces.

10. The Grandparent Scam

The Grandparent Scam is so simple and so devious because it uses one of older adults’ most reliable assets, their hearts.

Scammers will place a call to an older person and when the mark picks up, they will say something along the lines of: “Hi Grandma, do you know who this is?” When the unsuspecting grandparent guesses the name of the grandchild the scammer most sounds like, the scammer has established a fake identity without having done a lick of background research.

Once “in,” the fake grandchild will usually ask for money to solve some unexpected financial problem (overdue rent, payment for car repairs, etc.), to be paid viaWestern Unionor MoneyGram, which don’t always require identification to collect.

At the same time, the scam artist will beg the grandparent “please don’t tell my parents, they would kill me.”

While the sums from such a scam are likely to be in the hundreds, the very fact that no research is needed makes this a scam that can be perpetrated over and over at very little cost to the scammer.