Beware of Foreclosure Scams

Foreclosures are on the rise across the country and unfortunately, there is also a rise of rescue scams. These companies target homeowners who are unable to make their monthly mortgage payment and sell them on the them on the hope of a fast solution.

There are a variety of foreclosure rescue scams. A couple examples:

1) The company charges high fees to the homeowner for performing duties that otherwise a homeowner could of done themselves if supplied the right information, such as: making a phone call to the homeowners lender or obtaining a referral to a bankruptcy lawyer. And that’s it…no more service after this…

2) The homeowner is persuaded to give up title for 1-2 years to avoid foreclosure with the understanding they can remain in the home as a renter and/or promised to regain ownership of the property. The company holding the title will secure a new loan. The catch, is that the terms agreed upon usually have so many obligations to meet that it makes it almost impossible for ownership to be transferred back to the original owner. The company therefore retains the property and equity.

There are many of these companies out there. You’ve probably seen some signs in your neighborhood saying “We Buy Homes Fast”. Actually, I just received an email from one of these companies claiming to buy my home fast and give me instant cash in my hands and they even listed a few pros to their service:

no realtor fees
no open houses
no repairs
no signs
no appraisals
no costly delays
no waiting…

hrmm…honestly, would or wouldn’t you smell something fishy and think what’s in it for them?

Be careful of whoever you sign up with, for ANY kind of service.