Foreclosure Articles
Foreclosure Ripoffs and Scams
There is nothing wrong with spending money in exchange for worthwhile goods and/or services.
This page is dedicated to pointing out some examples of things to be cautious about when doing your research.
- "We'll save your credit." Pay us a fee and sign the house over to us. The foreclosure will be recorded against us, not you. The foreclosure will be reported against the borrowers on the note, not anyone else.
- "We'll give you some money, just sign the house over, we'll cure the default."
There really isn't a problem with it, if you know how much equity you are selling and if the purchaser really will cure the default and if the purchaser will really make the payments and if you want to still be responsible for the loan. Too many IFs to be able to say this is either a good or bad option. - "We'll buy the property, lease it to you, you have the option to buy it back."
It might have happened, but the reality is, to buy it back you'll need a new loan that's larger than the loan you have with an interest rate greater than what you have. The payments will be higher and it's going to be very difficult to qualify. Explore a small hard money loan if you have the equity or consider an open market sale, you'll probably end up with more money in your pocket. - "We'll get you a new loan and solve all these difficulties."
Every time you refinance, unless you are paying fees out of pocket, your loan balance is going up which is using up your equity. Lenders can make a lot of money churning loans, you need to consider total loan amounts also, not just the monthly payments. Try to solve the problem, not just extend the time frame. - " I'm an agent specializing in pre-foreclosures and I'll get your property sold quickly for top dollar."
Some agents have a relationship with an investor and work from published Default notices. You'll get an offer, but is the the best? We've seen listed properties in foreclosure recieve higher offers with no contingencies and the capability for quick closing that aren't always accepted by sellers. Why? Most likely, because they are never presented to the seller. Use local agents, get three Comparative Market Analysis and be cautious. - "Stop Foreclosure with Bankruptcy"
Bankruptcy does NOT STOP foreclosure. It puts a hold on foreclosure which can allow you time to reorganize your finances. Every area has reputable attorneys who handle bankruptcies. Spend the time to find one and spend the time to know what you have to do and when. Mistakes can cause things to get very bad very fast.
TIME IS NOT YOUR FRIEND WHEN FACING FORECLOSURE
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