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"How to Avoid Foreclosure Scams"
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Article: "How to Avoid
Foreclosure Scams"
By Andre Plessis
| Whatever you do, don't
fall for a "foreclosure rescue" scam. Scam artists promise to protect your
home from foreclosure but end up ripping you off and leaving you in even
worse financial shape.
Anybody who picks you when they come at you and you haven't called them, that's because they have a deal you really don't want to get involved in. |
Here are several precautions that should help you avoid being "taken" by scam artists:
Equity skimming. In this type of scam, a "buyer"
approaches you, offering to get you out of financial trouble by promising to pay
off your mortgage or give you a sum of money when the property is sold. The
"buyer" may suggest that you move out quickly and deed the property to him or
her. The "buyer" then collects rent for a time, does not make any mortgage
payments, and allows the lender to foreclose. Remember, signing over your deed
to someone else does not necessarily relieve you of your obligation on your
loan.
Phony counseling agencies. Some groups calling themselves "counseling agencies"
may approach you and offer to perform certain services for a fee. These could
well be services you could do for yourself for free, such as negotiating a new
payment plan with your lender, or pursuing a pre-foreclosure sale.
Remember that scam artists always try to take advantage of people that are in the most vulnerable situations. Like sharks and blood, scam artists always smell money.
 | Sam #1: The scam artist charges outrageous fees for simple phone calls or paperwork that the homeowner could easily do himself. None of these procedures will result in saving the home. This predatory scam gives homeowners a false sense of hope and prevents them from seeking qualified help. |
| Scam #2: In this scam, the homeowner is deceived into signing over title with the belief that he will be able to remain in the house as a renter and eventually buy it back over time. The terms of these scams are so onerous that the buy-back becomes impossible, the homeowner loses possession, and the scam artist walks off with most or all of the equity in the home. |
| Scam #3: In this case, the homeowners think they are signing documents to bring the mortgage current, but instead they surrender their ownership. They usually don't even know they have been scammed until they are evicted. |
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Scam #4: The scam artist often places ownership of the property into a trust in the owner's name in order to avoid the "due-on-sale" clause in most mortgage contracts. He then transfers ownership through the trust to himself or to a front operation. In these instances, the mortgage company is unaware that anything is amiss; the homeowner, however, is frequently left on the hook to pay the mortgage on a house he no longer owns. |
If you have received a foreclosure notice, contact your lender first. There are many remedies available, including renegotiating the terms of your mortgage, that can save your home or failing that, allow you to walk away with most of your equity. It is best you sell your home, walk away with your equity and your credit still in good standing. The worse you can do is wait, don't act, lose your home equity, ruin your credit, and your home. So seek guidance, act intelligently and quickly.
Andre Plessis
Andre Plessis
"The Mortgage Guru"
"A Mortgage Professional
whose primary goal is to provide the expertise, guidance and skills necessary to
obtain the best mortgage to meet your personal needs".
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