Fearing Foreclosure in Denver? - Don't Trust Your Fate to Late Night TV

When you call, typically, the company promises to solve all your foreclosure problems, a dream come true! Unfortunately, most of these companies are scammers. Some are legitimate, but many are schemers who have pulled names of delinquent homeowners from public records and responses to fast talking ads on late night TV. 

Usually they want an upfront payment, often equal to a month’s mortgage payment. The company may pocket the fee, while presenting the homeowner with a phony document that the foreclosure has been set aside. They may even ask the homeowner to sign over the deed to the property. The homeowner may think all is well until he receives a bankruptcy filing in the mail, filed in his behalf, without his knowledge. This leaves the homeowner with more legal bills, a poor long term credit picture as he will have difficulty buying or renting for 10 years, and perhaps, no home if he has signed over the deed. In some cases, the company does not even contact the lender. 

Foreclosure scams fall into three main categories:

Phantom help: The company promises to contact your lender, which they may or may not do, regardless of what they tell you. They may fill out some basic paperwork you could have completed yourself. 

The bailout: The company offers to buy the home and rent it back to you until you can buy it back. Many times, they pocket what you pay while never dealing with your lender so you end up with no property and no place to live.

The bait and switch: The company may have you sign documents to make the mortgage current, but actually you are signing over your home.

There are many variations on these scams but in any case, you usually end up in worse shape. Not only are you out the money you have paid, but you may have no property or, if you have stopped paying your mortgage on the belief the company was helping you, owe your lender more than you did before you called.

At the moment, we have a free Federal program called Making Home Affordable that will help many homeowners. Even if you do not ultimately qualify for this program, there is plenty of free or very low cost help available from HUD-approved counselors and non-profit groups that will either help you stay in your home or move on to a new stage in your life. Ironically, since the government started its program, foreclosure scams have actually been on the rise. 

Some scammers have even set up shop with company names or websites similar to those of reputable organizations. Hope Now Modifications, a flagrant New Jersey company, claimed affiliation with the Hope Now Alliance. Their website www.financialstability.org, which directs customers to a variety of payday loan, stop foreclosure, and debt relief sites, plays off domain-name similarity with www.financialstability.gov, a U.S. Treasury site.

At this point, the scammers have incurred the wrath of the President, the Treasury, the Department of Justice, the Department of Housing and Urban Development, and the Attorney Generals of several states. All have issued warnings to homeowners and have pledged better government cooperation to stop this type of fraud.

Late night TV and telephone pole ads cannot solve your problems.  However, as a Certified Distressed Property Expert (CDPE), I am committed to helping you stop foreclosure in Denver. Before you consider paying anyone to help you, check out our Denver avoid foreclosure website for tips on how to avoid foreclosure scams. At Bandy Homes, we can help you arrange a short sale or explore other options.

Marianne Bandy