7 Ways to Have Your Home Stolen From You During Foreclosure
Foreclosure and mortgage-related scams are getting to be big business.
To give you an idea of just how big, consider that the FBI received 43,497 SARs (suspicious activity reports) in the first 8 months of fiscal 2008.
That's compared to 6,936 for fiscal 2003.
In addition, there were 4,416 open mortgage fraud cases nationwide in late fiscal 2008, compared to 436 for fiscal 2003.
Operation Malicious Mortgage, a joint effort between the FBI, the US Postal Service, the Federal Deposit Insurance Corporation, and other agencies, has resulted in 287 arrests, 406 defendants charged, 173 convictions, and 81 sentencings.
Watch Your Back Facing the threat of losing a home, you'll be plagued by individuals and companies offering to "help" you out of your difficult financial situation.
In most cases, these people are out for one thing - to make money from your problem.
These scams come in many shapes and varieties...
ranging from direct mail offerings to "negotiate" on your behalf for a nominal fee to people knocking on the door offering to help out by reinstating your loan, taking title and then leasing it back to you.
People facing foreclosure are vulnerable to con-artists and scams.
However, by using a little common sense any home owner can avoid being taken advantage of and find a viable and ethical solution for their foreclosure dilemma.
The scams below are the most common ones to watch out for: Short Term Loans People may approach you and offer an "easy to qualify" for, short term loan that would allow you to escape foreclosure.
Short term loans typically have high interest rates, require balloon payments, or other features that sound attractive but cost you a lot of money in the long term.
The loans are often set up as additional liens against your home and if you fail to make a single monthly payment or the balloon payment, you could be facing foreclosure again.
Unethical Realtors Trying to Take Your Equity Real estate agents (many claiming to be "pre-foreclosure" specialists) offer to reinstate your loan and sell your home.
They tell you you'll be able to salvage the equity in your home.
The catch is they require you to split the equity with them rather than paying a standard commission.
Investors Trying to Take Your Equity Many investors, often the "I/We Buy Houses" people, approach home owners facing foreclosure offering to buy your home and wind up taking your equity instead.
They often also leave you responsible for paying your mortgage even though they supposedly bought the house from you.
They do this through a combination of slick talk and paperwork tricks.
Foreclosure Consulting Agencies Real estate investors will also set up "front" companies to make themselves look like a foreclosure assistance company.
Many of these companies use the same tricks discussed above to steal your equity, get the deed to your home, or to get you to sign a purchase agreement they can assign to a third party for a profit.
**Note: Signing a purchase agreement is not necessarily bad, but if a foreclosure assistance company makes you sign one, be suspicious and investigate them closely.
"Financial Services" Companies There has been a proliferation of individuals, often posing as financial services companies, offering to help you with everything from taxes to debt management to real estate sales and even pre-foreclosure sales.
These companies must be licensed in most states.
Be wary of anyone who is a "jack of all trades" or asks you to pay huge fees up front.
Visitors You can expect people, including investors and real estate agents, to visit your home.
They may paper your house with flyers, knock on your door at all hours, and stalk you and your family until they have an opportunity to speak with you.
The worst perpetrators are individuals posing as government employees dispatched to your home to assist you.
Your lender, the County, or the Federal government won't send out personal representatives to assist you unless you've initiated the call and asked them to come.
Bankruptcy No matter what an attorney may tell you, bankruptcy does not stop foreclosure.
It's does suspend the foreclosure process for a time.
Most homeowners that are in or nearing foreclosure just want a way out of the situation they're in.
Unfortunately, this can make you vulnerable to listening to people you wouldn't normally give the time of day.
Don't let your defenses down and remember...
if it sounds too good to be true, it is.
To give you an idea of just how big, consider that the FBI received 43,497 SARs (suspicious activity reports) in the first 8 months of fiscal 2008.
That's compared to 6,936 for fiscal 2003.
In addition, there were 4,416 open mortgage fraud cases nationwide in late fiscal 2008, compared to 436 for fiscal 2003.
Operation Malicious Mortgage, a joint effort between the FBI, the US Postal Service, the Federal Deposit Insurance Corporation, and other agencies, has resulted in 287 arrests, 406 defendants charged, 173 convictions, and 81 sentencings.
Watch Your Back Facing the threat of losing a home, you'll be plagued by individuals and companies offering to "help" you out of your difficult financial situation.
In most cases, these people are out for one thing - to make money from your problem.
These scams come in many shapes and varieties...
ranging from direct mail offerings to "negotiate" on your behalf for a nominal fee to people knocking on the door offering to help out by reinstating your loan, taking title and then leasing it back to you.
People facing foreclosure are vulnerable to con-artists and scams.
However, by using a little common sense any home owner can avoid being taken advantage of and find a viable and ethical solution for their foreclosure dilemma.
The scams below are the most common ones to watch out for: Short Term Loans People may approach you and offer an "easy to qualify" for, short term loan that would allow you to escape foreclosure.
Short term loans typically have high interest rates, require balloon payments, or other features that sound attractive but cost you a lot of money in the long term.
The loans are often set up as additional liens against your home and if you fail to make a single monthly payment or the balloon payment, you could be facing foreclosure again.
Unethical Realtors Trying to Take Your Equity Real estate agents (many claiming to be "pre-foreclosure" specialists) offer to reinstate your loan and sell your home.
They tell you you'll be able to salvage the equity in your home.
The catch is they require you to split the equity with them rather than paying a standard commission.
Investors Trying to Take Your Equity Many investors, often the "I/We Buy Houses" people, approach home owners facing foreclosure offering to buy your home and wind up taking your equity instead.
They often also leave you responsible for paying your mortgage even though they supposedly bought the house from you.
They do this through a combination of slick talk and paperwork tricks.
Foreclosure Consulting Agencies Real estate investors will also set up "front" companies to make themselves look like a foreclosure assistance company.
Many of these companies use the same tricks discussed above to steal your equity, get the deed to your home, or to get you to sign a purchase agreement they can assign to a third party for a profit.
**Note: Signing a purchase agreement is not necessarily bad, but if a foreclosure assistance company makes you sign one, be suspicious and investigate them closely.
"Financial Services" Companies There has been a proliferation of individuals, often posing as financial services companies, offering to help you with everything from taxes to debt management to real estate sales and even pre-foreclosure sales.
These companies must be licensed in most states.
Be wary of anyone who is a "jack of all trades" or asks you to pay huge fees up front.
Visitors You can expect people, including investors and real estate agents, to visit your home.
They may paper your house with flyers, knock on your door at all hours, and stalk you and your family until they have an opportunity to speak with you.
The worst perpetrators are individuals posing as government employees dispatched to your home to assist you.
Your lender, the County, or the Federal government won't send out personal representatives to assist you unless you've initiated the call and asked them to come.
Bankruptcy No matter what an attorney may tell you, bankruptcy does not stop foreclosure.
It's does suspend the foreclosure process for a time.
Most homeowners that are in or nearing foreclosure just want a way out of the situation they're in.
Unfortunately, this can make you vulnerable to listening to people you wouldn't normally give the time of day.
Don't let your defenses down and remember...
if it sounds too good to be true, it is.
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