How To Avoid Loan Modification & Foreclosure Scams

With the rise of homes that are going into foreclosure into today’s real estate

market, more and more scam artist are preying on uneducated home owners

with empty promises to save their homes from foreclosure.

Most information nowadays are accessible by lead companies, so when you are

late on your mortgage payment, your lender reports your late payments to the

credit bureau’s and they turn around and sell that information to companies such

as Foreclosure Rescue Firms and once the foreclosure process starts then this

information becomes public record which is free information for these con artist.

These Foreclosure Rescue Firms prey on individuals in foreclosure as they know

they are very vulnerable. So they compile a list and then start contacting home

owners the following ways: Door knocking and approach home owners in

person, send letters or post cards via mail, email and some even hire

telemarketers in India to contact home owners via phone. Usually they will use

sales teams that can sell ice to an Eskimo and will tell the home owner just what

they want to hear, whether it’s true or false.

Here is a list of some of the more common scam type Schemes:

- Lease-To-Own – They will ask you to sign over your title to their company

and in return they will catch up the mortgage payments or refinance the

property with better financing terms, which will allow the home owner to

stay in the home as a renter and they will give you the option to buy back

the property normally in a 1 – 2 year period. The intentions of most of

these companies are just to get your home, as they know you wont be

able to afford the new payments as they are normally higher than you

were paying before, or they know you wont be able to qualify for financing

within a year or 2.

- Bankruptcy – It’s important to understand that bankruptcy does not stop

foreclosure, it only temporarily delays it. Over 66% of people that file

bankruptcy don’t complete the plan, which places them back into

foreclosure. Not to mention that bankruptcy will negatively impact your

credit from years to come.

- Government Imposter Programs – There are a lot of companies that

that market themselves to appear as government affiliates and may use similar

names that sound like actual government agencies. If you do qualify for a

government program you lender will know, so contact them.

It’s important to understand that your mortgage lender has many options

available to help you avoid foreclosure. A lot of home owners stop

communication with there lender once they start falling behind to avoid the

collection calls and never get to find out about the options that are available to

them to save their home.

If you are going to hire a company to get you out of foreclosure and they are

requesting an upfront fee, you will need to proceed with caution. You will need to

do some due diligence and thoroughly research this companies back ground and

credentials. Ask for references and don’t just go by testimonials that are written

on their websites, as anyone can write these testimonials.

Both your lender and other government agencies can provide similar services at

no charge to the home owner. The first step is to contact you lender and they

can refer you to a government agency in your area.