BBB Tip of the Week: Mortgage foreclosure rescue scams
As part of the Federal Trade Commission’s ongoing efforts to protect consumers in financial distress, it obtained judgment against Dinamica Financiera LLC, Soluciones Dinamicas Inc., Valentin Benitez, and Jose Mario Esquer for mortgage foreclosure rescue scams targeting Spanish-speaking borrowers. Consumers taken in by these scammers can get a claim form from the refund administrator Gilardi & Co. LLC by calling (877) 281-5622 or at www.FTC.gov/refunds. The claim deadline is Jan. 14, 2013.
The Federal Trade Commission protects homeowners from mortgage assistance relief scams with the Mortgage Assistance Relief Services rule.
The MARS rule makes it illegal for a mortgage assistance company to collect any fees up front.
Only when the homeowner has received a written offer of relief from their lender and has accepted it, can the mortgage assistance company collect a fee. If the mortgage assistance company does not get satisfactory results, then the homeowner does not have to pay.
Mortgage scams to avoid:
• Phony counseling offers with an upfront fee.
• A forensic audit of your mortgage for an upfront fee.
• Rent-to-buy schemes. To avoid foreclosure, the scam artist asks you to surrender your home’s title to them and stay in the home renting from them, with the promise to sell the home back to you in the future.
• The bait-and-switch scam. “Rescue” loan services are offered, accompanied by a large stack of paperwork to sign. Within that stack is a document surrendering the title of your home to the scammers.
If you are struggling with mortgage payments or facing foreclosure, contact your lender immediately. You may be able to negotiate more affordable payments.
For information about other foreclosure prevention options, check out www.ftc.gov/yourhome. Also, free credit counseling is available from the Homeownership Preservation Foundation, a nonprofit, by calling (888) 995-HOPE (toll-free).
Erin T. Dodge, BBB editor