Unfortunately there are people who look to prey on people in financially
vulnerable situations like those facing foreclosure. There are two main types
of scams to be on the lookout for:
- Equity skimming. This is when a “buyer” approaches you, offering
to get you out of financial trouble by promising to pay off your mortgage or
give you a sum of money when the property is sold. They may suggest you move
out quickly and deed the property (legally sign it over) to him or her. The
buyer then collects rent on your property, doesn’t make any mortgage
payments, and allows the lender to foreclose. You may still be responsible
for the debt.
- Phony counseling agencies. Make sure you’re working with a
legitimate counseling agency if you choose to use one. You don’t need to pay
for many services such as negotiating a new payment plan with your lender,
or arranging a pre-foreclosure sale. Don’t pay for, or sign, anything before
knowing if the company/agency is legitimate. See the “Getting Professional Help.”
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