Foreclosure scams continue to be alive and well despite the fact that the foreclosure rate has dropped substantially in the last couple of years. Just this month in Overland Park, Kansas, three men, two now convicted and one currently being tried in court, partnered up in their attempts to commit mail and wire fraud against foreclosure victims. Luckily, the victims reported the fraud otherwise, nothing would have happened to the perpetrators.
Real estate agents can be one line of defense for people dealing with foreclosure issues by providing some of these informational tips to those in need of help.
1. Look out for people who make promises they can’t keep such as guarantees of being able to “save” someone’s home from foreclosure, of being able to lower someone’s mortgage payments in exchange for a “fee,” or claiming to have direct and/or personal connections with the mortgage company.
2. Charging fees in advance of obtaining a mortgage modification is illegal.
3. Only a mortgage company has the discretion/authority to grant a loan modification…no third party can guarantee or pre-approve a mortgage modification agreement.
4. Beware of mail/email/wire/phone solicitations claiming to be from your mortgage company that insist upon payments being sent to an alternative contact or location that is different contact information from the contact information on your mortgage statement.
5. Avoid any business that pressures you into signing papers/agreements you’ve either not read nor understood thoroughly.
6. Avoid any offer to buy your home for cash at a lower price than other homes in your neighborhood.
7. Beware of any companies that offer money back guarantees and/or upfront fees and companies that only accept payment by bank wire transfers and/or cashier’s checks.
8. Beware of any company or person that advises you to stop making your mortgage payments and/or to discontinue contact with your mortgage company.
9. Do not sign over your property deed to anyone other than your mortgage company or bank.
As a professional with credibility as a real estate agent, encourage those you know who may be vulnerable to a foreclosure scam to report that scam to the police. Also, encourage those you know to apply for mortgage assistance by contacting either 888-995-HOPETM(4673) or HUD’s Foreclosure Avoidance Counseling database.