Mortgage Foreclosure & Refinance Resource

“Bankruptcy foreclosure scams” target people whose home loan mortgages are in trouble. Scammers learn of upcoming home foreclosures through published reports and proceed to bombard the owners with phone calls, flyers and posters. The scam operators advertise over the Internet and in local publications.

As common sense dictates, you should never trust anyone who has contacted you, unsolicited, offering to help.

Here are descriptions of some of most common mortgage foreclosure scams:

• A scammer takes an up-front fee, to solve the victim’s foreclosure problems, and then does little or nothing, pocketing the money.
• The scammer promises to save the home by taking ownership of the home and renting it to the owner and then selling it back sometime later. Sometimes the home owner is fully aware that the title is changing hands, counting on the promise to be able to redeem it later. But other times the scammer tricks the owner. The signing over of title is buried in an avalanche of paperwork or in the language of the contracts. The scammers then resell the house or strip all equity from the house.

How to spot a scam:

• The company calls itself a “mortgage consultant,” “foreclosure service,” or similar name.
• Scammers assure the potential victims that they’ll handle everything. They tell you to make your home mortgage payments directly to the individual or company.
• Scammers tell victims not to call their lenders nor seek legal advice. They may even threaten extra charges from the lenders if you decide to contact them directly.
• Scammers have homeowners sign blank papers and fill them in afterward or they sneak the paperwork through without telling victims what they’re signing.
• Scammers attempt to collects a fee before they ‘provide’ any services to you.

If you can’t pay your mortgage, call your mortgage lender or contact a lawyer for help. Your state or local bar association may be able to help you find low-cost legal help. You should also read our ongoing series of tips on avoiding mortgage foreclosure.