Overly stressed homeowners facing foreclosure may find they are easy prey to scam companies that offer false loan modification schemes like a recent one that was halted by the Federal Trade Commission (FTC) in a U.S. District Court. In that operation, desperate homeowners were allegedly sold fake mortgage relief and foreclosure rescue products that amounted to over a $1 million take.
The FTC stepped in to file this case in federal court to stop innocent homeowners from further victimization and to take over the operation of that business in an effort to return some money to consumers who had been taken advantage of by the scam company. One scam operation down but more to go.
People who are dealing with financial and legal hardships including loss of their homes often seek relief from companies that hold out dream solutions to serious financial problems. Many seek loan modification but do not know exactly how to go about obtaining that relief. A fast pitch ad campaign may draw in these innocent consumers and before they discover these companies are fakes those consumers lose their money and still have the previous monetary and foreclosure problems to deal with.
The scam pitches involved promises of potential big money awards if consumers paid a sum to be included in a “mass joinder” lawsuit. They were promised credit relief, mortgage concessions and assistance in halting their foreclosure processes. Some of the scam operations uncovered by the FTC were businesses illegally posing as legitimate law firms. They allegedly made unreal promises about results and success records, and then failed to deliver any results.
Any homeowner who is concerned about losing their home to foreclosure should beware of possible foreclosure relief schemes. Rather than becoming involved in a scam and losing more money, those who are in danger of losing homes to foreclosure should call upon a reputable local law firm for professional legal advice.
Source: Collections & Credit Risk, “FTC Halts Alleged Mortgage Relief Scammers,” March 22, 2012