Mortgage scams are being invented and upgrading every day with the intent of the con artists gaining access to the equity in your home or even to the home itself. Avoiding these kinds of mortgage scams is essential for your financial well-being, not to mention your state of mind.
It is not an easy task to pinpoint what is a scam and what is legitimate assistance for mortgage-related problems because the scheming individuals have developed many complex, deceptive practices to snag a homeowner facing foreclosure. But once you have discovered you have been victimized, the emotional toll of what occurred may cloud your ability to use good judgment in rectifying the situation.
Here are some tips for what you should do and what you should not do when dealing with a mortgage scam:
What You Should Do
Confirm the Facts – you may think you are in foreclosure because you are behind on your mortgage payments but confirm the reality of where you stand by speaking with the lender yourself.
Contact Your Lender – the only real way to resolve mortgage issues is to contact the lender directly. Due to so much upheaval in the mortgage industry, you are surely not the first person to have financial problems that need additional assistance.
Educate Yourself – if you are in foreclosure, you have consumer rights meant to protect you so make sure you know what they are. Laws differ from one state to another so make sure you are well informed and better prepared to fight for your rights.
Get Counseling – a counselor certified by the Department of Housing and Urban Development can help guide you through the process of foreclosure prevention and show you other options for saving or selling your home. Only consult with a certified counselor to ensure you are not victimized again.
Get Legal Assistance – if the terms and conditions of the present mortgage situation is too complicated for you to understand, contact an attorney experienced with mortgage matters and ask them to review any documentation your receive from the lender or other third-party agency.
What You Shouldn’t Do
Ignore the Issues – if you suspect you have been victimized, do not avoid the issue out of embarrassment. By not taking action, the con has a bigger chance at getting away and leaving you in financial straits.
Sign Contracts Under Coercion – if you are desperate for help, you may be tempted to sign on the dotted line out of fear of the help disappearing. Never sign because someone told you to sign until after reviewing the documents thoroughly yourself or with the help of a lawyer.
Make Oral Agreements – any offer or negotiation should be done in writing with every detail outlined. Only after reviewing and agreeing with the documents should you sign a contract.
Make Payments to Third-Parties – a third-party agency may convince you to start making mortgage payments to them to clear up the foreclosure status on your home. Never send payments to anyone but your lender at the address listed on your mortgage statement.
Sign Over Your Home and Keep Your Mortgage – a popular scam involves the signing over the title of a home to a third-party using a contract that doesn’t include the signing over of the mortgage. In this scenario, homeowners get rid of their house but are still responsible for the mortgage payments.
Agree to Rent with Buyback Option – third-party agencies run a scam involving their claim on the home with the offer for you to rent the house until you can afford to buy it back.
