The Chicago Tribune ran a story this past week titled ”Man Admits Bilking Those Facing Foreclosure.” The story details an individual scammer, who called himself John D. Cash, Jr. and Typhon Ra, who used one of the most common scams listed in our foreclosure ebook, which involves both investor and debt collection scams. The man would promise to delay “foreclosure for his clients,” and “provide them with free and clear titles to their homes within two years.” In reality, according to the story, the man would only attempt to delay the foreclosure in order to pocket as much of the clients’ monthly payments as possible.
The most likely way this scam works is that an investor persuades a borrower in default to sign over the home, promising that this will make the investor liable for the monthly payment, which he will collect from the homeowners and forward to the lender. This is nothing but a scam and a lie, as signing over the deed to a home does not relieve the original borrower of their responsibility to pay their mortgage. The scammer will sit on the house, collecting payments and waiting for the home to go into foreclosure. Once the home sells at sheriff sale, the purchaser at the sale will own the property, clearing all other names off the title. In this way, the criminal investor can pocket tens of thousands of dollars; in this case, John D. Cash stole nearly $190,000 from unlucky homeowners.
The L.A. Times also ran an article on foreclosure scams as recently as yesterday, November 5, 2006. The story focuses on the equity skimming scam, also detailed extensively in our foreclosure ebook, and how it is used in conjunction with equity sharing programs. Equity sharing works when homeowners purchasing a home will find “private investors willing to share the cost of the home in return for future appreciation.” While this practice has led to more buyers qualifying for loans, this same technique has been criminally twisted by some immoral investors. Investors may persuade homeowners to sign over the deed to their homes and charge rent on a monthly basis. The problem comes when the former homeowner can not afford the higher monthly payment and “the investor ends up with the title or rent payments — sometimes both.”
In response to scams like these and numerous others, the Mortgage Bankers Association of America “has unveiled a consumer education campaign called Stop Mortgage Fraud in an attempt to help prevent scams and predatory lending.”
If you feel you have been taken advantage by one of these scams, or any other scam, you need to request a refund and protect yourself right now. Contacting a lawyer or regulatory agency is one of the best ideas you may have at this point. However, remember that saving your home should be the number one priority if you are in a foreclosure situation. While scammers should not be allowed to get away with their actions, you must save your home.
ForeclosureFish.com is dedicated to providing you with the most up-to-date news on foreclosure scams and any new discoveries of scammers and their devious techniques. As new scams are discovered, we will post them on our blog, as well as our dedicated foreclosure scam page.
No comments:
Post a Comment