Beware of Foreclosure Scams

Where there is money to be made, you will find the predators, salivating at a new opportunity to take people’s money and run. Welcome to the homeowner loss mitigation business where the sharks are having a feeding frenzy on already wounded homeowners who are facing foreclosure.

Homeowners need to be aware of these scams and what to look out for.

IamFacingForeclosure.com plans to expose the predators and educate homeowners about the legitimate foreclosure prevention services that are available to them through our network of legal aid attorneys, non-profits and loss mitigation professionals.

These scam artists usually locate you by when your lender files a foreclosure notice with the public trustee (aka Notice of Default), and your local community is notified through the foreclosure listings in your newspaper. Many of these companies actually prescribe to services that provide daily data of these filings or they go to the court house themselves.

H0meowner Beware: Here are some of the tricks these scammers use. Get educated and don’t become a victim!

Equity Stripping - These scams involve a lender or mortgage company (aka Hard Money Lender) that offers you an outrageous loan to “help” you avoid foreclosure. These loans are based solely on your equity and not your ability to pay. In other words, a loan made to “fail”. The moment you default on payments, they play hard ball and will foreclose on you in a heart beat. You see, that’s exactly what they want to happen and chances are heavily in their favor.

Loss Mitigation Consultant- There are many unqualified people offering to assist homeowners that are facing foreclosure. Theie attempt to be of service is actually a disservice and can seriously hurt the homeowner more than it can help. There in no licensing, regulation or policing of these consultants and “anyone” can become one and operate on their kitchen table over night.

Beware of anyone who offers to collect a fee up front to negotiate with your lender. Many are scammers and will take your money and run. Before you know it, the sheriff is knocking on your door and telling you to move out and the scammer is nowhere to be found. Make sure that if you are looking to hire a firm to represent you, that you do your due diligence and research the company before you sign any contract.

Loan Tranaction Scam- In these scams, a lender produces a refinancing loan document that claims to bring your delinquent mortgage current. This document will actually transfer the title of your home to the company’s name for part equity in your home. Usually these loans will include huge fees with big prepayment penalties, balloon or interest only payments and an adjustable rate that shoots through the roof almost immediately.

Next thing you know, this lender that was bailing you out is now taking you out and your house. Not a good loan is it?

So, be very careful and read whatever it is till you understand the document 100% and if you don’t, then hire trust worthy attoney or mortgage professional to examine the paperwork for you.

Government Foreclosure Scam Alert Links:

Department of Justice

Foreclosure Scam Articles:

Con-artists circling over homeowners in foreclosure

At the Legal Assistance Foundation of Metropolitan Chicago, the phone calls come nearly every day from yet another financially desperate homeowner who’s become the victim of a “foreclosure rescue” scam. “This has become the No. 1 problem in terms of calls we’re getting and cases we’re filing,” says Daniel Lindsey, supervising attorney for the foundation’s Home Ownership Preservation Project.

And it’s clearly a nationwide problem that’s likely to get worse. The Better Business Bureau has received complaints from every state and has issued an alert to warn consumers to be cautious about foreclosure-rescue companies.

A Springboro man pleaded guilty Tuesday in U.S. District Court to mail fraud for soliciting homeowners who were in danger of losing their homes through foreclosure.

Randall L. Webb, 50, was accused of “falsely promising homeowners he could provide affordable solutions and assistance to enable the homeowners to keep their homes and not put them in a more difficult position,” said Fred Alverson, law enforcement coordinator for the U.S. Attorney Gregory G. Lockhart.

Webb faces up to 20 years in prison, although Webb will likely receive a shorter sentence. Webb also agreed to make full restitution to victims. The loss is estimated at $5,000.

‘Angels’ hit desperate homeowners with foreclosure scam

Heartless scammers who call themselves “angels” are ripping off scores of desperate homeowners facing foreclosure, a Daily News investigation shows.Instead of rescuing them from the financial abyss, they steal their savings, their homes and their dignity.

One self-declared “angel” is Maurice McDowall, who ran a string of companies in Brooklyn, Manhattan and Long Island.

Presenting a business card that reads, “Helping you keep what’s yours,” McDowall promised to save homeowners from imminent foreclosure. Instead, his companies, which bore names like “Lost & Found Recovery” and “Home Mergers,” stripped them of their deeds and the equity in their properties, The News found.

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