Straight Talk: Don’t fall for foreclosure rescue scams

By Better Business Bureau
Posted Aug 9, 2020 at 11:00 AM

Are you facing the threat of losing your home? Be wary of individuals and companies offering to “help” you out of your difficult financial situation. Consumer advocates report an increase in complaints about foreclosure “rescue” scams. These scams specifically target homeowners who are in financial distress. Scam operators may advertise over the Internet and in local publications, plaster posters on telephone poles and at bus stops, stick flyers in people’s front doors or contact people whose homes are listed in public foreclosure notices. Sometimes they direct their appeals to specific religious or ethnic groups.

 HOW THE SCAM WORKS
In one scenario, the scam operator offers to “buy” the homeowner’s property by paying off the amount that is overdue on the loan. The scammer convinces the homeowner to deed the property over to a third party. The homeowner is given the option of renting the property with the option to buy it back later. The rent payment on the home is often higher than the homeowner can afford. Frequently, the original homeowner cannot make the rent payment and is evicted from their home. Or, if the homeowner expresses a desire to buy back the property, the scam operator usually sets the price of the home higher than the homeowner can afford.


Hapless homeowners can lose their equity and their homes. Sometimes, the homeowner’s troubles go even deeper. In many cases, the initial mortgage has not been paid off and the deed was never transferred, as promised. Not only is the homeowner faced with eviction from the home, but the scam victim may still owe for the original loan amount.


In other versions of the scam, the homeowner receives a call, text, or email with the promise of lowering the mortgage payment and avoiding foreclosure. The scammer sometimes asks for payment for their services in the form of personal checks or gift cards. A recent victim in Ohio reported to BBB Scam Tracker that she sent $3000 in Walmart gift cards to a scammer asking for payment to help lower her interest rate.


The Better Business Bureau advises consumers who are tempted by such offers to recognize that they are at real risk of losing money, equity, their home or all three.
 

Tips to help if your mortgage is in arrears or you are facing foreclosure:
‒ Talk to your lender. Ask how to restructure your loan payment or how to refinance. Some foreclosure “rescuers” will offer to “negotiate” with your lender or lawyer. Know that such an offer is likely to involve a significant fee. If you are hesitant to talk to your lender yourself, engage the assistance of a trusted family member.
‒ Try selling the house on your own to pay off the lender. Signing over a deed in no way releases you from your mortgage responsibilities!
‒ Don’t allow anyone to complete paperwork for you, or ask you to sign a stack of documents, supposedly to secure a new mortgage. Victims have later learned that they signed a quit-claim deed to their home.
‒ Beware the personal approach. Some less-than-ethical businesses will stuff a handwritten note in your front door or mailbox that implies that “help” is available from someone you know or who has your best interests in mind. Foreclosure scam artists know exactly what neighborhoods to blanket with their offers.
‒ If a foreclosure “rescuer” instructs you not to contact your mortgage company or your attorney, beware. Your mortgage company is the very business that you should be in touch with! Furthermore, why would you agree to cease contact with your attorney when dealing with complicated financial matters that involve perhaps your biggest investment, your home?
‒ You should never sign a contract under pressure and never sign away ownership of your property when you don’t intend to sell it. Ask a trusted family member, your attorney or a financial professional to review any paperwork you may be asked to sign.
‒ Never pay with gift cards. A reputable company will not ask for payment via a gift card.
‒ Before signing any deals with a potential buyer, contact BBB to request a report on the company and check with your state Attorney General and local government department of consumer affairs.
‒ Seek foreclosure prevention information. Try calling the HOPE hotline, 888-995-HOPE, for free foreclosure prevention information, or visit their website at 995hope.org. According to the National Conference of State Legislatures website, the HOPE hotline is operated by the Homeownership Preservation Foundation, a nonprofit “dedicated to preserving homeownership and preventing foreclosure.”
 

FOR MORE INFORMATION Read more about housing scams in BBB’s Scam Alert on Home Title Fraud. This can be found at www.bbb.org/article/news-releases/22679-bbb-alert-home-title-fraud. If you encounter a scam, we ask that you report it to BBB.org/ScamTracker to help warn others.

There are no “quick fixes” to clean up your credit

June 24, 2019
by Lisa Lake, Consumer Education Specialist, FTC

If you’re trying to clean up your credit, you’ll come across plenty of companies offering an easy fix. But any company promising instant results for a price is likely a scam.

The FTC says Grand Teton is one of those companies. In its lawsuit, the FTC says Grand Teton tricked people into paying hundreds – even thousands – of dollars for so-called credit repair services.

Through websites, sales calls, convincing emails, and text messages, the company allegedly promised to boost credit scores by removing all negative items, among other things, from customers’ credit reports – and also boost scores by adding the customer as an authorized user on other people’s credit cards. But people who signed up with Grand Teton didn’t see a significant change in their credit scores, despite paying hefty (and illegal) up-front fees. And, if consumers complained or tried to get their money back from their bank, Grand Teton allegedly threatened to slap them with lawsuits.

Here’s the thing about credit repair: there’s rarely an instant fix. To clean up your credit and protect yourself from credit scams:

• Get a free copy of your credit report (from AnnualCreditReport.com). Review it carefully. Do you recognize all the accounts listed?
  
• If you find mistakes, contact the credit bureau and the business that reported the information. They must delete inaccurate or incomplete information. You don’t have to pay anyone to do this for you – you can dispute inaccurate items on your credit report yourself, for free. There’s nothing a company could do for you that you couldn’t do yourself.
  
• Only time can correct negative, accurate information on your credit report. You can rebuild your credit by paying your bills on time, paying off debt and not creating new debt.

If you need help cleaning up your credit:

• Contact a legitimate credit counseling organization. Good credit counselors review your whole financial situation before they make a plan. They won’t promise to fix all your problems or ask you to pay in advance.
  
• Learn how to spot a credit repair scam.
  
• ? Does the company ask for money up front?
  
• ? Did they say not to contact the credit bureaus yourself?
  
• ? Did they tell you to dispute accurate information on your credit report?
  
• If you said “yes” to any of those, stop right there. You’re probably dealing with a scam.
  

Learn more about cleaning up your credit history. And, if you know about a credit repair scam, report it to the FTC.

The original case<https://f.datasrvr.com/fr1/219/92022/ocwen_first.pdf>
was filed in the Eastern District of New York in August of 2013. The fourth amended complaint<https://f.datasrvr.com/fr1/119/78019/ocwen_fourth.pdf> was filed in April of 2017, doubling the length of the original complaint.

Ocwen and several related companies were accused of a massive fake-check enrollment scheme. Ocwen, "America's largest subprime loan servicer," according to the most recent complaint, teamed up with co-defendant Cross Country Services Inc., which mailed millions of small ($2.50) checks to Ocwen customers. The checks were disguised as a refund or other remuneration related to the customer's Ocwen account.

The plaintiffs alleged that when the checks were cashed, Ocwen and Cross Country took the customer's endorsement as a sign-up for Cross Country's home warranty plans. Ocwen then added a line item charge to its bills for the Cross Country services, which usually went unnoticed by the customers when they sent in payment. Ocwen gave Cross Country the proceeds, and Cross Country, in turn, shared a percentage of the revenue with Ocwen.