Links & News

Foreclosure Scams 101
 
Alameda County Foreclosure Scam (San Francisco Chronicle)
Analysis of available law enforcement and industry resources indicates that the top ten mortgage fraud areas are California, Florida, Georgia, Illinois, Indiana, Michigan, New York, Ohio, Texas, and Utah. Other areas significantly affected by mortgage fraud include Arizona, Colorado, Maryland, Minnesota, Missouri, Nevada, North Carolina, Tennessee, and Virginia. There is a strong correlation between mortgage fraud and loans resulting in default and foreclosure.
 
Mortgage Rescue Scams Hit Close to Home (ABC News)
Among the byproducts of the U.S. housing crisis is a surge in scams that cheat people out of their money, their homes, or both, under the guise of offering to rescue them from foreclosure. There is a lot of money to be made if you are good at committing fraud," said Debra Zimmerman, an attorney at Los Angeles-based Bet Tzedek Legal Services, which provides free legal assistance to stricken homeowners. "Foreclosure rescue scams are big business right now."
 
 

A Tale of Two Families

Meet the Smiths & the Joneses
The Smith Family and the Jones Family were both "upside down" in their homes (owing more than the current market value of the properties). Both families were having trouble making the ever increasing monthly payments on their adjustable mortgages. The Smith Family was committed to "making good" on their loan. They were convinced the lender would eventually cooperate with a "short sale." Or maybe the economy would turn around or the government would come up with a program for them in time to save their home. But it didn't happen. Hanging on until the bitter end, the Smiths were eventually forced into bankruptcy, at which time they pretty much lost everything. It might take them a decade or more before they finally get back on their feet again. The Jones Family took a different approach. They saw the writing on the wall. They knew they weren't going to be able to continue to make increasing monthly payments. They knew their lender was more interested in stretching out the time during which they made payments on the full amount of the loan than cooperating with a short sale that would greatly discount the loan. They considered their financial obligation to the lender important but their obligation to pay for health care and make their car payments so they could continue to get to work was even more important. They decided to Walk Away. The money they were able to save from the eight months that they were not making mortgage payments or paying rent, combined with the other maneuvering that they were able to do as a result of unburdening themselves from what had become an oppressive mortgage, put them in a position to get back on their feet again in about three years. What's more, from the day they made the decision to Walk Away, they enjoyed the peace of mind that comes from a stress-free existence. The Smith Family and the Jones Family: Who was "right" and who was "wrong"?That may be hard to say but one certainly did come out on top.