What is Foreclosure Fraud?

            Foreclosure fraud is a kind of fraud
that takes advantage of those in danger of undergoing foreclosure. If you have
fallen behind on your loan payments, there are legitimate options for help.
However, you must be wary when determining the best options for you, because a
foreclosure scam can be devastating, especially when you’re already having
money problems.

Kinds of Foreclosure Fraud

            Foreclosure fraud can come in many
different forms. Some of the most common kinds of foreclosure fraud include
promises of modifying a mortgage to make it more affordable. These can occur in
multiple ways.

            Some scammers may offer a
modification of the mortgage for an upfront fee. After receiving this fee, they
will disappear. The home is often foreclosed on because the individual does not
have the funds to continue mortgage payments after they’ve paid the lump sum to
the scammer.

            There are also “balloon payments,”
where a lender offers to significantly lower the monthly mortgage payment. This
works because the individual is only paying the interest on the mortgage. The
lender then demands the complete amount of the loan in one balloon payment. The
buyer will most likely be unable to pay this payment.

How to Protect Yourself From Foreclosure Fraud

            It is important to be wary of
anything concerning foreclosure. Only use reliable sources and companies for
refinancing and money managing options. Make sure that you read any contracts
thoroughly before you sign them. If you don’t understand something in the
contract, ask about it. It may also be helpful to have a lawyer review any
contracts. Keep in mind that if an option seems too good to be true, it
probably is.

            Foreclosure fraud can be downright
devastating to your bottom line. Take necessary precautions to prevent
foreclosure fraud from affecting you. To learn more about preventing
foreclosure fraud, contact us at LeBaron & Jensen today!