by Bob Boog

There are many different types of loan modification, short sale and foreclosure-related scams, and new types of scams sprout up every day. There are probably as many scam categories as octuplet mother Nadya Suleman has babies, but today we’ll discuss just three of them. These activities can be loosely described as follows:

Invisible Assistant:

In this type of action, the scam artist offers to negotiate with the lender or perform other lender-related services for the homeowner in exchange for a fee. However, in reality, the scammer performs little or no service at all and eventually absconds with the money. Whatever services the scam artist does provide, the homeowner could have probably done on his or her own. The homeowner ends up not only losing the money, but often loses valuable time to make other arrangements to save his or her home from foreclosure.

The Rescuer Technique:

In this one, the helper offers a scheme which will save the homeowner from his dilemma. One common example involves a promise to take title to the property, make up the back payments, and then lease the property back to the homeowner until he can purchase the property. Usually the scammer ends up not honoring the rent-back agreement, kicks out the owner and sells the property to another buyer.

Bait-and-Switch:

The homeowner is saved from his dilemma by the generous helper who offers to bail him out. Perhaps the helper promises to take title to the property, modify the loan, and then lease the property back to the homeowner until he is able to purchase the property. Usually the scammer ends up not honoring the agreement, and does the old switcheroo. Meaning that because he is the owner, he can legally kick out the owner. Often the helper rents the property until it is foreclosed upon and keeps all the rent receipts for himself.

In addition to these types of deals, there are many other kinds of scams, including identity-theft, loan fraud, and even elder abuse. How do owners meet these people? The helper can contact an owner by mail or telephone solicitation or sometimes an owner will contact a scammer via a We Buy Homes or Stop Foreclosure Now sign on a telephone pole.

If you are concerned about a loved one working with a foreclosure helper, some tell-tale signs to watch for include: if a helper asks for payment only in the form of cash, cashiers check or wire transfer ” beware. If a helper asks you to transfer title or your interest in the property– beware; or if a helper makes an guaranteed promise to stop foreclosure or other assurances”beware.

Just as one would be wary of eating raw fish as a restaurant with a quality rating of D ” when it comes to foreclosures, short sales and loan modifications, you should be extra cautious with people offering their services to help you too!

About the Author:
Real estate broker Bob Boog has thirty yrs experience in the real estate business, and has penned three books on selling homes. His latest book, Mortgage Modifications Made Easy is available for download, and a free sample can be found at his website.