Foreclosures are once again on the rise. In a time of high housing costs, rising mortgage rates, economic uncertainty, and the end of COVID-19 foreclosure protections, more and more Americans are facing challenges. According to a recent report from MarketWatch, foreclosures are up in every state. In the first quarter of 2022, there was a 67 percent quarterly increase in new foreclosures compared to the fourth quarter of 2021 and 188 percent when compared to the prior year.
Sadly, foreclosure scams remain a very serious problem. Unscrupulous parties try to take advantage of people who are already struggling and are desperately trying to save their home. At the Law Offices of Scott J. Goldstein LLC, we want to make sure that people have the knowledge and resources they need to avoid scams. In this article, our New Jersey foreclosure attorney highlights some of the most common foreclosure scams.
Four of the Most Common Foreclosure Scams
- Internet and Phone Foreclosure Scams
With internet and phone foreclosure scams, fraudsters try to find people who are struggling. They will then make them false promises that they can help them save their home. You will often be asked for some form of payment. In reality, these types of scammers are typically just trying to take your money. The scammer will misrepresent their services—and maybe even their identity—to get as much as possible out of the victim.
- Mortgage Refinance Scams
While there are absolutely legitimate mortgage refinancing services, scammers often tout great refinancing as a way to take advantage of struggling homeowners. A scammer may actually pose as a mortgage broker. They may even tempt you with wholly fraudulent mortgage foreclosure rescue documents in order to try to get an initial payment out of you before they run away without doing anything at all to save your home.
- Scams on Lease-Back and Repurchase
Be very skeptical of a lease-back and repurchase strategy as a tool to avoid foreclosure. It is one of the most common types of mortgage foreclosure scams. A scam operator will convince the homeowner to “sign over” the deed to the property. They will make promises that they can clear the delinquent debt and repair your credit, all while allowing you to stay in your home. Most often, they are simply trying to push you into an unfair agreement through which they can take your property through an eviction.
- Equity Skimming
Equity skimming is a type of foreclosure scam through which a scammer will try to get access to your property in order to squeeze out any last remaining equity. They will try to tell you to “give” them the property and move out immediately. They will then take over your mortgage payments and rent out the house. In reality, equity skimming means collecting as much rent as possible while not making any mortgage payments. The house could quickly end up in foreclosure.
There are Real Options Available: An Experienced Lawyer Can Help
The unfortunate reality is that people and families who are facing mortgage foreclosure remain a target of scammers and fraudsters. These bad actors know that people desperately want to save the house that they turned into a home. Sadly, unscrupulous individuals and companies try to take advantage of the situation by providing false hope. They use false hope as a means to commit fraud.
There is some good news: there are real legal options available for financially distressed homeowners. While pandemic-related foreclosure protections have faded, New Jersey has made dedicated funding available to help people. You may qualify for assistance through the New Jersey Emergency Rescue Mortgage Assistance (ERMA) program.
Another potential option is bankruptcy protection. Depending on the specific circumstances of your case, consumer bankruptcy protection could potentially stop and fix a mortgage foreclosure. An experienced attorney, such as New Jersey and New York bankruptcy lawyer Scott J. Goldstein, will help you navigate the legal process.
Call Our New Jersey Personal Bankruptcy and Foreclosure Attorney Today
At the Law Offices of Scott J. Goldstein LLC, we are committed to helping our clients navigate some of life’s greatest financial challenges. If you have any questions or concerns about bankruptcy, foreclosure, and your legal options to save your home, our legal team is here to help you determine the best course of action. Contact us today to set up a completely confidential consultation with an attorney. We provide personal bankruptcy and foreclosure representation throughout North Jersey and New York.