Foreclosures on Rise, BBB Warns

By Margaret Jackson The Denver Post

With 2.7 million homeowners nationwide
facing foreclosure, scammers are flocking to
take advantage of the crisis, the Better Business
Bureau warned this week.
There are two main types of foreclosurerescue
and loan-modification scams: advance-
fee loan-modification schemes and
sales-leaseback schemes, according to a recent
report by the U.S. Government Accountability
Office.
Advance-fee loan-modification schemes
prey on anyone who is in debt but especially
the most desperate. In a foreclosure situation,
scammers charge the homeowner a fee
in advance to negotiate a deal with a mortgage
lender. They may offer a money-back
guarantee. In the end, they take the victim’s
money, provide little or no service and refuse
to refund the fee.
In a sales-leaseback scheme, scammers persuade
victims to transfer the home deeds to
them by offering to assume the payments
while the victims pay rent. The scammers
promise to sell the properties back to the victims
when they get their financial affairs in order.
But the scammers don’t sell the properties
back and often take out another loan or
sell the houses.
To avoid being scammed, the Better Business
Bureau recommends homeowners
should avoid businesses that:
B Guarantee to stop the foreclosure process.
B Instruct you not to contact your lender.
B Collect a fee before providing a service.
B Accept payment only by cashier’s check
or wire transfer.
B Encourage you to lease your home so you
can buy it back over time.
B Offer to fill out paperwork for you.
B Pressure you to sign paperwork you
haven’t had a chance to read.
Margaret Jackson: 303-954-1473