Mortgage Scams: Fraudulent Foreclosure “Rescue” Professionals

Beware of forensic mortgage loan audit scams – a new twist on foreclosure rescue.

Foreclosure Scam

Fraudulent foreclosure “rescue” professionals use half truths and outright lies to sell services that promise relief to homeowners in distress. Mortgage loan auditors, for an up front fee of several hundred dollars, backed up by forensic attorneys offer to review your mortgage loan documents to determine whether your lender complied with state and federal mortgage lending laws. They will tell you, you can use the audit report to avoid foreclosure, accelerate the loan modification process, reduce your loan principal or even cancel your loan.

This is not true. The Federal Trade Commission (FTC) says there is no evidence that forensic loan audits will help you get a loan modification or any other relief, even if they are conducted by a legitimate company. You may be allowed to sue your lender based on errors but it does not force your lender to modify your loan.

If you are in default on your loan, the best thing to do is contact your mortgage company and then an attorney. Communication with the lender is the best.

Beware and avoid any business that:

1. Guarantees to stop the foreclosure process – no matter what your circumstance are.

2. Instructs you not to contact your lender, lawyer or housing counselor.

3. Collects a fee before providing any services and accepts payment only by cashier’s check or wire transfer.

4. Encourages you to lease your home so you can buy it back over time.

5. Recommends that you make your mortgage payments directly to them, rather than your lender.

6. Urges you to transfer your property deed or title to them/

7. Offers to buy your house for cash at a fixed price that is inappropriate for the housing market.

8. Pressures you to sign papers you haven’t had a chance to read thoroughly or that you don’t understand.

Call HUD for free personalized advice from housing counseling agencies at 888-995-HOPE. It is open 24/7. for free guidance online visit www.hopenow.com.

Another site for home mortgages and other credit issues is www.ftc.gov/MoneyMatters.

If you think you have been dealing with a foreclosure fraudster contact:

Federal Trade Commission – www.ftc.com

State attorney general- www.naag.org

Better Business Bureau – www.bbb.org

If you have a bankruptcy question call or email David at david@ambroselawgroup.com or 248-624-5500

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Filed under Bankruptcy/Debt, David Lutz

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