The FBI tracked mortgage fraud for the past decade and revealed that 91% of all Mortgage Fraud in the past decade took place between 2007 – 2010.  

 
FBI Stats

If someone asks you to engage in any of these activities, you want to run the opposite way.   Protect yourself by arming yourself with knowledge.

Mortgage Scams

If you are one of the 10 Million Homeowners who is behind in mortgage payments and have come to the difficult conclusion that you can no longer afford to keep your home but also cannot sell it either and are looking for a way out, there are dignified solutions available to you.  Foreclosure is not the only course.  You may not be aware, but there are alternative solutions which may not only allow you to sell your current unsellable home, but may also provide you with  thousands of dollars to make it happen, if you qualify.

The HAFA (Home Affordable Foreclosure Alternatives) program is a Federal Government sponsored program to help homeowners in distress.  IT COSTS NOTHING TO THE HOMEOWNERS.   Real Estate agents can help you with the process, but the homeowners do not pay the Realtors; their commissions are paid from the proceeds of the HAFA sale.

Unfortunately, many homeowners are not aware and are being duped by swindlers who claim to be able to help.    Below are 10 signs of Mortgage Modification Scams.
Mortgage Payments Weighing You Down Report

These are both financially and emotionally difficult times for these homeowners and also ideal climate for swindlers to come swooping in. However, there is a solution available for these homeowners without falling victim to fraud. I invite you to do your due diligence and find an agent who can help you out of this dilemma who has the experience, the skill set and references to protect your financial future.

Change the Course Report

If you follow this blog, you know one thing I really hate are frauds against people facing distress.  Nothing worse, in my opinon, than taking advantage of people who are desperate because they are about to lose their homes.  It’s targeting one of the most vulnerable segment of society in order to make a few bucks.  Those fraudsters are the worst scum in my opinion.

I found a blog by a Realtor named Monique Bryher in Southern California who writes about various California Real Estate Frauds, it is called Califorinia Real Estate Fraud Report.  I found it to be an excellent place to learn about the fraud of the day, if you will.  I wanted to take a moment to talk about it because it is well orgranized by topic and because you can also receive a weekly report about the fraud du jour.

The best way to avoid being victimized is to be educated about scams.

http://www.californiarealestatefraudreport.com/

Check it out.

I have said this many times, but my personal pet peeve is hearing of scammers who try to take advantage of people who are victims of these economically difficult times.    It is bad enough that many homeowners are suffering and find themselves in a situation where they are unable to pay their mortgages.  But far worse to believe they are victimized again a second time when they put their hopes on people who profess to be there to help.  Sometimes even the lenders are engaged in practices that are bordering on scams called dual track foreclosure.

Every time one of these scammers is identified, I get worked up and get into my crime busting mode…….   So here we go again.

The first tell tale sign of a fraud or scam is that the so called service providers are asking for payments up front, before any work has been performed.  ALWAYS BE LEERY OF THESE REQUESTS.  There are multiple variations of these pay-first scams.

A recent scam identified by the California Department of Real Estate (DRE) involves up front payment to join a class action lawsuit which promises extraordinary home mortgage relief.  A brief description of the con has been reposted below for review purposes.

QUESTIONABLE AND/OR FALSE CLAIMS OF THE SO-CALLED MORTGAGE LOAN

DEFENSE OR “MASS JOINDER” AND CLASS LITIGATORS.

A.  What are the Claims/Sales Pitches?

They are many and varied, and include:

1. You can join in a mass joinder or class action lawsuit already filed against your

lender and stay in your home.  You can stop paying your lender.

2. The mortgage loans can be stripped entirely from your home.

3. Your payment obligation and foreclosure against your home can be stopped when

the lawsuit is filed.

4. The litigation will take the power away from your lender.

5. A jury will side with you and against your lender.

6. The lawsuit will give you the leverage you need to stay in your home.

7. The lawsuit may give you the right to  rescind your home loan, or to reduce your

principal.

8. The lawsuit will help you modify your home loan.  It will give you a step up in the

loan modification process.

9. The litigation will be performed through “powerful” litigation attorney

representation.

10. Litigation attorneys are “turning the tables on lenders and getting cash settlements

for homeowners”.

In one Internet advertisement, the marketing materials say, “the damages sought in your

behalf are nothing less than a full lien strip or in otherwords [sic] a free and clear house if

the bank can’t produce the documents they own the note on your home.  Or at the very

least, damages could be awarded that would reduce the principal balance of the note on

your home to 80% of market value, and give  you a 2% interest rate for the life of the

loan”

There are many varieties of scams identified and collected by the DRE over the years, some of them are listed below in the Consumer Alerts page for your benefit.    http://www.yourhome.ca.gov/fraud_warning.pdf

Homeowners in distress, I know you are in desperate situation and are seeking any and all assistance you can find, but please don’t let your situation cloud your judgment.  Be the wise consumer that you always have been.  Please check on the people who profess their desires to help you.  Know who you are dealing with before you give them any money.

Interestingly, these guys used a PO Box address near the White House and used a seal that looked like it could have come from the US Capitol and made falsely made claims to have attorneys and forensic accounts on staff.

Never, ever pay up-front money to anyone, who claims to be able to get your loan modified.

http://ag.ca.gov/newsalerts/print_release.php?id=1879

Here is a report which should shed some light onto and hopefully steer some homeowners away from some of the scams that are being used out there today.

I have written on numerous occasions about the most despicable people on the planet, in my opinion, those scammer who prey on the desperation of homeowners who are about to lose their homes to foreclosure.  These “loan modification” or “foreclosure rescue” specialists or consultants took upfront money and made grandiose promises of keeping the homes from foreclosing, yet in most cases, did nothing to stop the process.

Many claimed to be attorneys or affiliated with attorneys, as if such affiliations meant they were more legitimate than those who had no such affiliation.  These scams had become so rampant that the California Department of Real Estate maintains a list of practitioners who are suspected of engaging in fraudulent manners and who have received desist and refrain orders.

On the national level, Congress has allocated funds to help fight these types of fraud. And California enacted similar laws to fight these heinous crimes against the vulnerable homeowners whose backs are against the wall.

But the crafty scammers manage to continually dupe homeowners into giving them money, without providing any services in return.

Well finally, someone refused to take it from these scammers and took the matter into their own hands.  Feeling nothing was being done on their behalf and being denied a refund, the couple kidnapped the scammers and tortured them.

Now I am not advocating violence against anyone, but you can certainly empathize with the frustration and the betrayal these people must have felt before resorting to such extreme measures.

What can we learn from this tragic situation?  Never ever give anyone money upfront to help you save your house. Any legitimate organization or person cannot take money first, but can only be paid if successful  service was provided first (at least here in California) .