Millions of homeowners have seen their homes go into foreclosure in recent years and there will be even more in the next few years. With the increase in foreclosures, “foreclosure rescue” scams are also on the rise.
Promising a fresh beginning and offering to remedy a homeowner’s foreclosure situation, scam artists contact the homeowner by phone, in person, or by mail with a note of urgency. Scam artists are very sneaky and have become increasingly deceptive in finding ways to fool homeowners out of their homes and money.
“We’ll help you keep your piece of America,”
Homeowners who place their trust in foreclosure rescuers–who may play up religious or ethnic identities with names like “Christians Helping Homeowners” – can end up financially devastated.
“We’ll help you keep your piece of America,” promised advertisements distributed by a Dallas “consultant” who was sentenced in August 1998 to 24 months in prison and ordered to repay $58,000 in restitution for bankruptcy fraud and bank fraud.
Defrauded home owners had each paid the defendant from $2,000 to $15,000 in fees and mortgage payments. Almost 30 home owners are believed to have lost their homes due to her activities.
Like sharks going in for the kill, scam artists move quickly and with great control. The victims often do not know what’s happened to them until it’s too late. Scam artists mostly prey on homeowners who are equity rich, but cash poor, including — the elderly, the desperate and those that are not familiar with the foreclosure process.
Homeowners whose homes are listed for foreclosure should be especially on guard for….
- Individuals or companies calling themselves “mortgage consultants,” “foreclosure specialists,” or anything similar
- Anyone that sends you flyers or solicits door-to-door
- Tries to collects a fee for helping you and before providing services to you
- Tells you to make your mortgage payments directly to them individual or their company – and not to the mortgage lender
- Tells you to transfer your property deed or title to the them or their company
The traits of a foreclosures scam artist are often hard to recognize because they are so good at it and they are good actors. Scammers are adept at disguising their true intent with lies, exaggerations, pressure tactics and other ploys that can be quite complex.
Some of their tricks include:
- They use face-to-face meetings to exploit homeowners with come-ons in the belief that most people will not lie in person
- They will try to keep home owners clueless about the foreclosure process, their legal rights, and alternatives that may be available for saving their home
- They will forge your name and use complex documents that conveniently run out of space for signatures, thereby forcing the homeowner to sign a blank page that is later attached to a different document
- They use “affinity marketing” techniques where Hispanics market to Hispanics and Christians to Christians with the idea that people like you are on your side and they are protecting you from others who don’t have your best interests at heart.
And just how do you tell an honest foreclosure rescuer from a fraud?
The first thing you should do is ask them for three references of other homeowners they have helped. This alone will send many of the foreclosure scammers running. Secondly, tell them that you will be having your attorney review everything they suggest to you or try to get you to sign. Common sense isn’t it?