Foreclosure Fraud

How to Protect Yourself from Foreclosure Frauds and Scams

Who Commits Foreclosure Scams and Fraud?

The predators will arrive at your doorstep posing as caring friends and they promise to creatively and instantly solve your problems. Actually they are only interested in stealing your hard earned equity or even your home itself.

These titles are red flags and you need to get your guard up. They will act like your best friend, raise your expectations, and tell you everything you want to hear.

Be extremely skeptical of anyone claiming that they can help you. Ask them for references so you can look into their qualifications, background, and business standing. That will immediately get rid of some of the worst of the foreclosure fraudsters as they won’t have any good references to give you.

For the rest of the foreclosure rescue “specialists” that are still left stalking you, you will need to learn how to recognize and learn the sneaky methods they will use to try to and rip you off. YOU are the first line of defense in protecting yourself.

Just like the other types of real estate and mortgage fraud, the recent boom in the real estate market with fast appreciation in homes prices and now the increase in foreclosures due to mortgage interest rate increases have caused a dramatic increase in foreclosure fraudsters.

There has also been an increase in foreclosure scams because there is an abundance of "get-rich-quick" foreclosure seminars being taught. These seminars and courses are actually teaching people how to find desperate homeowners facing foreclosures and shows them the methods they need to follow to take over their homes.

These so called “real estate investing” seminars actually teach their attendees how to convince homeowners into giving their properties away.   These scams are being taught all around the country – you may have seen some of their half page ads in the newspaper or infomercials on late night TV.

In  Washington alone, one of these real estate gurus had 800 people show up at his seminar to learn how to get rich buying foreclosure properties from distressed sellers. They paid admission fees of $750 to $1,250 for the seminar and on top of this they were offered 3 day boot camps and coaching programs for up to $10,000 to learn their dirty

There have been major outbursts of these scams in all over the country, no city or state is immune.   And, it is important to note that most of these scams go completely unexposed or unpunished because homeowners don't even realize what has happened to them.

Also, most homeowners that are going through a foreclosure can rarely afford to hire attorneys so the scammers realize their risks are low.   It is also a fact that state regulators lack investigative staff to go after these cases, and even when they do uncover them, they often don’t have the legal authority to do anything.

As mentioned earlier, scam artists first learn of homeowners in distress by combing through public foreclosure notices in newspapers and government offices---documents that are readily accessible on the Internet or they subscribe to services that provide them with lists of names. They also locate potential “customers” by running advertisements on TV, radio, the Internet, billboards and bandit signs. Bandit signs are those “We Buy Houses” signs you see nailed to telephone poles, etc.

The truth be told, when I was a private real estate investor, I have used these bandit signs in the past as a marketing tool to get people wanting to sell their homes to call me. I even used magnetic signs “We Buy Houses – 800-881-6694” attached to the side of my car - (and on my eldest daughter’s car until her boyfriend wouldn’t get in the car with her).

I discovered that I enjoyed working with people that needed to sell their homes and we were very successful working together.

Working with people that HAD to sell their homes was a different story in many respects. While associates of mine and I were able to help many a distressed seller get out of a difficult situation, many waited too long before they asked for help and we were unable to help them.

So, remember:

Rule Number Two – You Must Take Action

Sooner, rather than later.