Foreclosure Scams

Posted on July 16, 2008
Filed Under Foreclosures |

If you are worried about foreclosure and looking for a answer to your situation, do not be taken in by the “We Stop Foreclosure” or “We can Save Your Home” If you are not careful, you may become the victim of a foreclosure scam.

Foreclosure scams are everywhere. You will find them on the internet and elsewhere. Like a lot of things on the internet, what you find about foreclosures may not be a real business or be a company that can help you keep your home. If you find a website that states it can stop the foreclosure of your home and the site does not seem right to you in some way, trust your instincts. They may be telling you that you might be reading a site that is fraudulent.

There are a number of ways a scammer will claim to help you after you receive a foreclosure notice. One red flag is when the foreclosure “rescue” company claims that they will pay your back payments to your mortgage holder. There are no charities that will send your lender money “just because”.

The scam artist may also tell you that you can refinance your home and take out another mortgage to pay the first one. If your current lender will not let you take out another loan than it is unlikely that another lender will let you borrow money if you have defaulted on your mortgage. You will find that a loan shark may loan you money to save your home but if you do not pay them back, they will be the ones to foreclose on your home.

If a scam artist tells you that you can stay in the home as a tenant and take back the title later, this is false. There is no company that will let you purchase the home again after you have given away the interest. You do however have the right to stay in the home until the foreclosure is finished. This could take a few months or a year, depending on your location.

Do not pay a fee upfront to stop foreclosure. No one can promise you that they can stop a foreclosure. You are capable of working out things out with your lender. You are in a better position than an outsider.

Also, do not make payments to a foreclosure “rescue” company. The company may promise to stop foreclosure if you make payments to them but the truth is there is no quick fix when it comes to foreclosure. Your lender will talk with you about your options and assist you in making the right choice that best suits your needs.

Never sign over the deed to your home. If the foreclosure “rescue” company tells you to sign over the deed to your home and that the transfer is only temporary, this is not true. No deed is temporary, they are final. Even if the deed to your home is not recorded publically, if you have signed over the deed to your home and have transferred the title, the house is no longer yours but you still may be liable for the mortgage.

If you believe you are the victim of a foreclosure scam, report this to the Attorney General.