Foreclosure Scam Days Re-Revisited

With the downturn in the real estate market in full swing, more homeowners are finding that they are unable to stop foreclosure by simply selling the house. Home values have fallen, making refinancing another option that homeowners no longer have available. Nearly all of the recent news relating to foreclosure has been focused on helping these homeowners avoid the various foreclosure scams that have begun appearing in large numbers, as criminals target the high valued asset of real estate.

These news articles have begun detailing one of the more well-known scams, which involves tricking the homeowner into signing over the deed to the home in exchange for an offer of cash or an equity loan. The fact is, though, that these scammers take over ownership of the home and pay the homeowners an incredibly small price. The foreclosure does not end, and the homeowners are eventually evicted by the new owners, the scammers, or the bank once the house goes to sheriff sale.

Another scam that is appearing in the news more often is that of "foreclosure rescue service" firms. These companies also trick foreclosure victims into signing over the deed to their homes, and promise to pay the mortgage. However, the homeowners are charged rent, which goes straight into the scammers' pockets, are evicted, and then another family is moved in, also to be evicted once the foreclosure process has completed. In this way, the foreclosure scam is responsible for two families ending up without a home, rather than just one.

The sheer number of these types of news articles is amazing, considering that they are the result of poor consumer education regarding how the real estate market and their own mortgages work. If a homeowner is facing foreclosure, then the best defense would be to learn more about how the foreclosure process works, rather than trust a third party who may not have the best interests of the homeowner at heart, and who will actually benefit if the house if foreclosed.

It is this ignorance that homeowners have to fight against even more than their lender. Ignorance of how to stop foreclosure legitimately has cost homeowners thousands of dollars and the loss of their homes to unscrupulous foreclosure scam companies. The loss of a home to a scammer is much too high a price to pay for remaining ignorant of how foreclosure works.

If homeowners are in a hardship situation and are in danger of foreclosure, the best bet would be to follow a few basic guidelines: understand any documents they are asked to sign, never sign away the house unless a sale is taking place, never send money up front for vague "services" which may never be performed, and know all of the options that can be used to stop foreclosure.