Scam artists can get away with a lot, especially when people are not aware of their tactics. When you own a home or property, the last thing you want is to fall victim to a scam. Below, are a few of the most common mortgage and deed scams and ways to identify them.
LOAN MODIFICATION SCAMS –
Loan modification scams occur when a scammer offers to negotiate with a homeowner’s lender to lower the owner’s interest rate for a certain fee.
The scam often results in the homeowner paying the fee, only to receive no modification and he or she could possibly end up behind on mortgage payments and short on funds.
DEED THEFT –
Deed theft scams involve the fraudulent transfer of a home or property to a third party. Deed theft can come in different forms. Owners are tricked into thinking it’s temporary, only to realize later that they’ve signed their home over for good. If you’re contemplating refinancing your mortgage, or anything else that may modify your current mortgage, make sure you ask questions and read the fine print before you sign anything.
IMPERSONATION SCAMS – Foreclosure and other financial issues related to home ownership can make people desperate. Scams occur when homeowners are tricked into thinking they’re hiring a company to prevent their homes from falling into foreclosure. If you’re struggling with your mortgage payments, the best first step is to contact your lender and ask about a new repayment schedule. Be aware of companies offering something that may seem too good to be true.
MORTGAGE SCAMS – Mortgage loan scams abound, so beware! Scammers will: advertise low-interest rates that aren’t actually available; ‘forget’ to inform buyers of high closing costs associated with their mortgage loans; steer buyers toward a more expensive loan with higher closing costs although they qualify for a loan with better terms; offer adjustable-rate mortgages but fail to inform buyers that the rates can increase or fluctuate in the future; and even offer negative-amortization loans.
FAKE LAWSUITS & FORENSIC AUDIT SCAMS – Fake lawsuits are those lawsuits that promise to ‘sue banks’ on behalf of homeowners.
Many times, the lawsuits are fake, and the homeowner can be out thousands of dollars.
Another scam not easy to recognize is a forensic audit scam. This scam is focused on making the homeowner believe there are flaws in his or her mortgage document that could lead to an affordable modification or even nullify the mortgage loan.
There will always be people looking to take advantage of hard working people, especially when money is on the line. If you’re a homeowner, don’t fall prey to a scam. Ask as many questions as possible. Research everything you can. Talk to your realtor for more information.
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