Avoiding scam artists when facing foreclosure

Minnesota homeowners may not be aware of scams offering protection against foreclosure. In the current economic climate with a stalled housing market and higher than normal unemployment, homeowners may find it difficult to make their house payments on time. This may lead to foreclosure action by the lending company. Foreclosures are publicly announced, and this source of potential victims helps scammers prey on unwary individuals.

Homeowners need to know common tricks that scammers use to get what they want, namely the homeowner's property. One of the tricks scammers use is to separate homeowners from lenders. They do this by instructing the homeowner to allow them to speak to the lender on their behalf. The scammer may also offer to take ownership of the home and offer the homeowner a chance to buy it back. This allows the scammer to gain legal title. Other signs of a fraudulent operation include asking for a payment before providing their service and not giving the homeowner a clear representation of what they do.

There are other several common ruses scammers use. One is called bait and switch. Homeowners may think they are signing documents for one purpose, such as mortgage payment protection, when the homeowner is actually transferring title. Scammers falsely appear as white knights asking homeowners to sign over the title of their home by offering them lease payments instead.

Being aware of such frauds may help the homeowner avoid these ploys. The homeowner may also benefit from consulting an attorney who may advise them on the different forms of bankruptcy available to them. For example, homeowners facing foreclosure may be able to prevent it from happening by filing for a particular type of bankruptcy. An attorney may help the debtor determine if they are eligible.

Source: Findlaw, "Protect Your Home from Foreclosure Rescue Scam Artists", November 20, 2014

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