Dont Support Unethical Lenders and Scam Artists

Homeowners facing foreclosure are often more prone to be exploited by crooks. These people thought they had the American dream of owning their very own home under control, but now, cruelly, they see it slipping away. Unfortunately, in today's real estate market, more and more people are discovering that their homes are not "sure things." They find themselves incapable to make mortgage payments that are rising with the interest rates. They start receiving letters from their lenders, and phone calls too. It is often at this point that the scam artists make first contact with their prey.

The quickest, and most basic scam is one orchestrated by an individual or company that promises to rescue your house and arbitrate with your loan holder and other debtors for a "small," upfront fee. They make the fee sound like a great situation. After all, regardless how long it takes or how hard it might be, for the price of a single mortgage payment, this company will rescue your house! But, after the check is cashed, this company is long gone and the property owner facing pre-foreclosure is out a mortgage payment and their dignity.

In another rendition of this scam, the company may ask for a large sum or for the distressed homeowner to make mortgage payments directly to that company rather than the mortgage holder. In this scam, the con artists may in truth make a a call or two or complete some documents; however, these are all things that could easily be executed by the homeowners. Plus, paying those preposterous "administration fees" only put financially desperate people in an increased state of deterioration. In the worst version of this particular scam, the company also neglects to make any of the pledged mortgage payments. Instead, homeowners find themselves even more behind on payments. Of course that seemingly obliging individual and/or company has disappeared off the map.

Bolder scammers have exploited legal loopholes to strip owners in pre-foreclosure of any equity they may have built up in the property. They find long-term homeowners facing foreclosure and offer them a loan to cover the remainder of the mortgage. In one variation of this scam, the interest rates of the loan are close to usurious, and the result is that the owner ends up defaulting. After all, if the original payments are impossible to pay, higher payments only quicken the inevitable. However, the scammer will have higher charges and default rates built into the new loan than the old lender. In some cases, the homeowner finds a way to continue making payments. Either way, the scammer profits.

Many of the rest of the foreclosure scams involve "misunderstandings" by the homeowners. The con artist will appear at the last minute and make lots of promises. Once the contracts are finalized, the former homeowners find that the contract they thought was saving their home was really signing it away. Even more depressing, they may be still bound with mortgage payments they were trying to escape. Many variations on this theme exist and desperate homeowners must remember to take care to avoid these scams.

No matter how hopeless your situation may look, you should carefully examine all legal documents and agreements you enter into. If you don't understand what the document entails, have an attorney examine the papers. Do not trust any promises that are not made in writing! These are not contractually enforceable. Do not sign a contract that has blanks or has not been completely filled out. Remember, if your first language isn't English, use your own interpreter. Do not use an interpreter provided by the company. Finally, the old saying is continuously proved to be accurate: if it sounds too good to be true, it is probably just that.