Mortgage Fraud and Foreclosure Recovery Scams have become a common problem of all homeowners nowadays. This is a bigger problem especially for those homeowners who are having trouble paying their mortgage payments and are threatened by foreclosures.
There are thousands of companies that are requesting such homeowners by telephone, mail, email and over the Internet to refinance or modify home loans. They are also offering help with bad credit or bankruptcy. But homeowners need to be able to recognize and understand the signs of mortgage fraud in order to protect themselves. They should also know whom to contact for help.
Certain things and situations you need to beware of are:
1. Phony counseling: You should be on an alert for phone calls from companies or people who claim to be professionals and claim to save your house for an upfront "negotiating" fee. You will generally be advised not to talk to the lender, credit counselors, attorneys or respond to the courts. Beware of such calls because these might be fraud calls where the person might just elope with your money without any negotiations or help.
2. Bait and Switch: Be very careful while signing any kind of papers or legal documents. You might be made to believe that you are signing documents to help you pay your mortgage and avoid foreclosure but in reality you may really be signing over your house ownership in the cheaters name.
3. Rent to buy: Be extra cautious to understand all the terms and conditions if you are opting for rent to buy option. In rent to buy, owners are told to transfer legal ownership of the property to the seller and continue living in it on rent with an option of buying back the property in the next few years. The terms of this deal are usually so confusing and troublesome that buying back the home becomes almost impossible.
4. Bankruptcy Foreclosure: In this case you might be given false assurance that the agency will negotiate with the lender for a fee, but instead the fraud agency may flee with your money and file a bankruptcy in your name.
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