FORECLOSURE SCAMS INCREASE IN NUMBER AND CREATIVITY

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EDITOR’S NOTE: Hoak’s article only points out three varieties of scam but there are many more. The long and short of it is that homeowners do need help in gathering information and using it effectively with the assistance of a licensed attorney. But they are not getting the help they need in most instances and they are not getting effective counsel. Here are three categories of scams:

The first is foreclosure rescue. Anyone telling you that the foreclosure will stop if you pay them money is lying to you, pure and simple. The only thing that will stop a foreclosure is a Judge’s order. The automatic stay in bankruptcy is the order of the court. So unless if you have sought and obtained a signed order from a Judge or filed for bankruptcy relief, there is no stopping the foreclosure. Period. Most of these people take your money and run. Some fo them are lawyers who will tell you they are working on it but are doing nothing and won’t return  phone calls once they have your money.

The second uses a short-sale as a vehicle for fraud. There are many varieties of this. Some demand fees up front to get it done, some interpose themselves as middlemen, not submitting the bid they should submit, the list is endless. The worst case scenario is that  you get foreclosed and don’t even know it. You move out thinking the sale went through when in fact nothing happened.

The third one she mentions ought to be the first. It is the false payoff. This hurts everyone. Mostly used in “refis” it  often happens in sales. The writer could have written a full investigative article about this. These “payoffs” send money to someone who has no interest in the deal, no right to receive the money and no authority to release the old mortgage. OR the title or closing agent simply keeps the money from the new deal and doesn’t pay anyone. They get away with it because nobody knows who the creditor is anyway. The homeowner in a refi starts paying the new mortgage source but the old mortgage is still on there going into “default.“

SEE FULL ARTICLE ON SCAM IN WALL STREET JOURNAL

By AMY HOAK

Fraudsters will always finds ways to scam lenders and homeowners. And in recent years, they’ve shifted their tactics to profit from the market’s downturn.

Today, there’s less identity fraud and misrepresentation of income or employment to obtain a mortgage, mainly because of stricter validation criteria, says David Johnson, vice president of fraud and consortium solutions for CoreLogic, a provider of financial, property and consumer information. But other types of fraud are replacing those scams.

Tags: bankruptcy, borrower, countrywide, disclosure, false payoffs, foreclosure, foreclosure defense, foreclosure offense, foreclosure rescue, Foreclosure scams, foreclosures, fraud, LOAN MODIFICATION, modification, mortgage scams, quiet title, rescission, RESPA, securitization, short sales, TILA audit, trustee, WEISBAND
Posted in bubble, Corruption, Eviction, securities fraud |