Beware of Foreclosure Assistance Scams

People who are facing foreclosure are usually in a vulnerable state of mind. The very thought of foreclosure and losing their homes is enough to make people panic. This is a time when they are prone to predatory 'stop foreclosure' scams offered by accomplished con artists. In desperation many of the homeowners facing foreclosure fall victim to these con artists who promise to save them from losing their homes, but eventually make matters worse. They cheat homeowners of thousands of dollars by misrepresenting facts and by telling lies. Homeowners not only lose their homes they also get deeper into debt.

There are many ways in which the foreclosure scams are operated. When home owners are facing foreclosure the con artists urge them to transfer their deeds for a small payment. They promise return the deed after some conditions are met. However in return for a small amount they end up losing the house as well as the substantial equity they have in the house. When the house is sold it fetches more than what is owed and the con artist who now holds the title gets all the surplus funds. In such cases the homeowners unwittingly give away their equity in their homes at a throw away price.

Some scamsters will assure you that they will save your credit if you sign the home over to them so that the foreclosure will be recorded against them and not you. Actually the foreclosure will be reported against the borrower that is against you. Some people will offer to help you to file for bankruptcy to avoid foreclosure. Bankruptcy will only delay foreclosure and can land you in trouble if done fraudulently.

Some people will offer to buy the property at a lower price and lease back to you with an option to buy it back. But to buy it back you will probably need a new loan at a much higher rate of interest and it may be difficult to qualify for a loan the next time. It is better to look for a money loan against the equity or else consider going for a open market sale with the permission of the lender, you will probably end up with surplus cash and your credit score intact.