Types
- Types of property rescue scams
i) Phantom help ? In this scam, the supposed ?rescuer? charges very high fees for basic phone calls and paperwork that the homeowner could have done. Or, the rescuer will make promises to represent the homeowner but will not follow through. This is really a too little too late scam as the helpless homeowner usually receives too little (or no) help too late to stop the foreclosure from taking place.
ii) Bailout ? Here the scammer bails the homeowner out by helping them get rid of the house or giving the homeowner a loan on condition that he sign documents not knowing that he is selling his property. The way the scammers get the house varies, but each method ends with the homeowner surrendering the title of the house on the promise that they can stay on as renters and buy the house back once things have been "fixed." In the end, of course, the homeowner can't buy the house back and the supposed rescuers get most, if not all, of the equity.
iii) Signing over of property ? This foreclosure scams involves signing away the ownership of your home. The owner only finds out that he is no longer the owner when he is evicted from his property.
iv) Debt review/liquidation/sequestration- Clients are approached by consultants to apply for these process not knowing the consequences. Assets are then handed over to these individuals/companies who will lease it to 3rd parties.
- Tips for bank clients to avoid falling victim
Tips
Avoid doing business with companies, consultant and individuals that:
§ Guarantees to stop the foreclosure process.
§ Instruct/request you not to contact your bank/lender.
§ Collects a fee before providing any service.
§ Encourages you to lease your home so that you can buy it back over time.
§ Tells a client to pay your bond instalment to anyone other than the Bank.
§ Offers to buy your house for cash at a fixed price that is not set by the market at the time of sale.
§ Pressures you to sign paperwork that you have not read thoroughly or that you do not understand.
Furthermore:
§ Discuss repayment options with your loan servicer/lender, and do not ignore letters and other communication from your bank.
§ Compile a budget and determine the mortgage payment you can afford.
§ Create a file to record all communication with mortgage servicers, agencies, and financial institutions.
§ Don?t be rushed into a deal with a foreclosure ?rescuer? with promises to stop a foreclosure.
§ Don?t pay a foreclosure ?rescuer? in full until all services are performed as promised.
§ Do not agree to a repayment program if your bank is not informed and have agreed to such a repayment plan
Tips
Avoid doing business with companies, consultant and individuals that:
§ Guarantees to stop the foreclosure process.
§ Instruct/request you not to contact your bank/lender.
§ Collects a fee before providing any service.
§ Encourages you to lease your home so that you can buy it back over time.
§ Tells a client to pay your bond instalment to anyone other than the Bank.
§ Offers to buy your house for cash at a fixed price that is not set by the market at the time of sale.
§ Pressures you to sign paperwork that you have not read thoroughly or that you do not understand.
Furthermore:
§ Discuss repayment options with your loan servicer/lender, and do not ignore letters and other communication from your bank.
§ Compile a budget and determine the mortgage payment you can afford.
§ Create a file to record all communication with mortgage servicers, agencies, and financial institutions.
§ Don?t be rushed into a deal with a foreclosure ?rescuer? with promises to stop a foreclosure.
§ Don?t pay a foreclosure ?rescuer? in full until all services are performed as promised.
§ Do not agree to a repayment program if your bank is not informed and have agreed to such a repayment plan