Mortgage foreclosures bring out vultures
While the number of mortgage foreclosures soars, so do the incidents of foreclosure scams. Here are some of the signs that a mortgage foreclosure scam is in the works:
Bailout specialists promise to “rescue” the homeowner from foreclosure in exchange for fees that can run into the hundreds or thousands of dollars. Little work is actually done except for a few phone calls.
In the rescue scam, the homeowner is told to sign certain loan documents that will take care of the impending foreclosure — except that the documents actually sign the title over to the scammer. The homeowner is left with no house and is still responsible for the mortgage.
In a variation of the rescue scam, the homeowner is told that the scammer will make the payments and take care of the foreclosure, and the homeowner can rent the house until he’s able to buy it back later. The end result is that the homeowner is evicted when the scammer collects the rent, defaults on the payments or sells the house to someone else and pockets the profits.
If you can’t make your mortgage payments and fear losing your house, talk to your lender. The earlier you do this, the better your chances that arrangements can be made to avoid foreclosure.
Here are some more tips:
• Never sign any documents that have blanks, no matter how you’re pressured. Don’t sign any documents before you read (and understand) every word.
• Don’t respond to calls or mail about foreclosure rescue. There are companies that scour courthouse records to collect names of homeowners in trouble.
• Never pay a fee for mortgage foreclosure assistance or services. Call a HUD certified counselor, but even then be careful. See the Web site at www.hud.gov.
• Don’t agree to send payments to anyone but your lender.
• Never make any verbal agreements or trust anything that is not in writing.
• Know your state laws. Length of time of the foreclosure process varies.
• Contact an attorney who specializes in consumer law.
Most important of all, don’t sell your house at a low price just to get rid of it, especially if the buyer is offering to “take it off your hands” and save you from foreclosure. Enlist the help of a real estate agent to help you determine the true value of your home.