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Foreclosure Prevention Scams

The rise in foreclosures has lead to a rise in scams against homeowners by individuals offering to help them save their homes.  Foreclosure prevention scams fall into two general categories.  Home equity theft, commonly referred to as “deed theft” scams involve a third party offering to get the homeowner out of foreclosure by refinancing the debt with a new loan.  The deed is transferred, sometimes unknowingly, into the name of the third party (referred to as an “equity purchaser” in New York) who then gets a loan in their name or the name of a straw buyer.  The homeowner is promised they can remain in the home and then buy it back in a year or more, once they repair their credit and can obtain their own financing.  The trick is, the purchaser either evicts the homeowner within a few months and keeps the property to sell on their own, or they obtain a loan for an amount considerably higher than what was owed and keep the equity cashed out, leaving the homeowner with an unaffordable mortgage and a home in someone else’s name. 

Distressed property consultants, commonly referred to as “mortgage consultants,” offer to help homeowners through the foreclosure process and negotiate on their behalf with lenders, but for a hefty fees.  These folks don’t have any tricks that aren’t already available to homeowners if they were to work with their mortgage servicers directly or go through a non-profit housing counseling agency. 

To find a non-profit housing counseling agency which provides free default and foreclosure assistance in your county, click here to go to NY Homes & Community Renewal's Division of Housing & Community Renewal.

 



ARTICLES

Top Ten Ways The CFPB Can Help You With Financial Questions
The U.S. PIRG Education Fund has put together this great resource of how the CFPB can help you. It includes information on how to make complaints to the CFPB. Read More

For black Americans, financial damage from subprime implosion is likely to last
The implosion of the subprime lending market has left a scar on the finances of black Americans — one that not only has wiped out a generation of economic progress but could leave them at a financial disadvantage for decades. Read More

Justice Deceived: How Large Foreclosure Firms Subvert State Regulations Protecting Homeowners
Why do foreclosure actions take so long in New York? As found in this report by MFY's Foreclosure Prevention Project,"it is the law firms that handle foreclosures in bulk which have caused the current backlog of foreclosure cases in New York State courts." Read More

Mortgage Lending and Foreclosure Prevention Advocates
The following are descriptions and links to state and national advocates working on issues pertaining to mortgage lending and foreclosure prevention. Read More


Foreclosure Prevention Scams: Articles



IN THE NEWS

WATCH: The Zombie Home Apocalypse In Monroe County
According to Rebecca Caico, Senior Staff Attorney with Empire Justice Center, there are thousands of zombie properties in Monroe County. We’ll discuss how they’re haunting taxpayers in ways they may be unaware of. Read More

Schneiderman announces targeted advertising campaign to help Buffalo-area homeowners avoid foreclosure rescue scams
Attorney General Eric T. Schneiderman today announced a targeted advertising campaign and consumer education initiative to help Buffalo homeowners spot, avoid and report mortgage rescue scams. Read More




POLICY ADVOCACY

Empire Justice Memo of Support: Improving Mortgage Foreclosure Settlement Conferences
This bill provides clarifying amendments to CPLR 3408, bringing the statute in line with the rules and practice of the courts. Read More

Empire Justice Memo of Support: Provide Clarity Regarding Standing to Sue in Foreclosure Actions
This bill provides a homeowner defendant the right to challenge standing at any time they learn that the plaintiff may not be the rightful party during a foreclosure proceeding. Read More





NEWSLETTERS

Policy Matters April 2012
Empire Justice Center’s newsletter focused solely on policy. This inaugural issue will focus on the recently passed state budget and how it will affect lower income New Yorkers, including people at risk of foreclosure, health care consumers, people with disabilities and those needing civil legal services. Read More





RESOURCES

Top Ten Ways The CFPB Can Help You With Financial Questions
The U.S. PIRG Education Fund has put together this great resource of how the CFPB can help you. It includes information on how to make complaints to the CFPB. Read More

Foreclosure prevention scams
The rise in foreclosures has lead to a rise in scams against homeowners by individuals offering to help them save their homes. Foreclosure prevention scams fall into two general categories. Home equity theft, commonly referred to as “deed theft” scams involve a third party offering to get the homeowner out of foreclosure by refinancing the debt with a new loan Read More


Foreclosure Prevention Scams: Resources