As foreclosure rates continue to climb, reports of fraud schemes aimed at homeowners facing foreclosure are increasing. Authorities are warning homeowners to be aware of some of the new scams being played out upon unwary victims during some of their most vulnerable times. Taking advantage of a desperate situation, scammers appear concerned and helpful however their ultimate goal is to steal the home’s equity. These “Rescue Scammers” all operate differently and methods vary, but generally most of the scams fit into 3 categories:
Sale-Leaseback Schemes – The scammer presents themselves as a savvy investor with a desire to help families in need. The scammer offers to buy the house, bring the mortgage up to date, and let the homeowner rent back the house indefinitely with the intention of buying back the home. Preying upon a family’s basic desire to remain within their house, these “investors” convince homeowners to sell the homes far below what the home is worth. The home is never rented back to the family; it is usually flipped with the investor vanishing.
Charging High Fees For Little or No Service– In this situation a scammer will pose as a legitimate foreclosure consultant, oftentimes as a mortgage or financial broker. Exploiting the complexity of a foreclosure or refinancing, the scammer operates off of the assumption that the average homeowner is hesitant to handle mortgage matters themselves for fear of making a mistake or by simply assuming they wouldn’t understand it. The scammer locks the homeowner into a yearly contract and charges exorbitant fees for services the homeowner could have easily done himself or herself. You can avoid this by following a very simple rule: Legitimate foreclosure consultants do not seek you out, you have to go to them. If they are contacting you there may be reason for suspicion.
Stealing The Home – Undoubtedly every homeowner’s worst nightmare, but it happens, and oftentimes to otherwise wary and intelligent people who let their guard down during desperate situations. In these schemes, the foreclosure scammer gets the homeowner to surrender ownership of the home usually through outright deceit and trickery. In many reported cases, the homeowner believed that they were signing new mortgage loan documents, when in fact they signed over their homes. In some cases of flagrant criminality, scammers simply forged the homeowner’s signature on documents, counting on the fact that the average homeowner does not pay enough attention to their foreclosure proceedings, and will notice only when it is too late.
The companies and individuals who scam people are experts in gaining trust. They are often smooth talkers, keenly aware of a homeowner’s desperation. They will either call you, send a mail item or e-mail, or may actually come to the house in person. If you are having financial difficulties, or are about to go into foreclosure, make sure you deal solely with your lender as soon as the problems start. Lenders would prefer that you stay within your home and will work with you, as well as recommending the proper and certified consulting you may need.
One thing that will be of benefit to you is having a reputable Realtor working with you and advising you while you are working with your lender for a solution. Though they are not legal counsel, they are often very experienced with foreclosure proceedings. If you trust your Realtor (and you should, otherwise don’t work with them!) they can be an invaluable source of information and informal advice. An experienced Realtor knows the process and will help you find the right solution.
About the Author: Let Taft Street Realty be your professional guide to Hudson Valley real estate. Check their website to view all Ulster County community listings, including real estate in Stone Ridge NY.
Keith Munsell 
