Foreclosure fraud on the rise

The rising levels of unemployment, slowing industrial growth, falling incomes and the sub-prime crisis have led to an increase in the number of foreclosures in the U.S. housing industry.

Homeowners facing a foreclosure have to deal with their financial crisis on one hand and, on the other, guard themselves against the rising incidence of frauds and scams related to the foreclosure market. Indeed, the number of frauds and scams related to the foreclosure market has grown at a disturbing pace in the very recent past.

Perhaps the biggest and the most valuable advice is not to run away from mailings and phone calls from your lending institute when one files a notice of default. In fact, you should do exactly the opposite. Be upfront and transparent with the lending institution about the financial crisis that you are going through. It is very probable that the lending institute will restructure your loan and provide you the necessary breathing space that you are looking for.

Make note of the fact that the lending community is much more informed about the current state of the economy and would do whatever possible to help you get out of this difficult phase. It is widely believed that the best way to avoid trouble related to fraudulent companies and individuals working in the foreclosure market is to work directly with the lending institute.

A number of media advertisements promote individuals and companies that will “work a miracle for you.” Stay away from such companies. While it is important that you do not approach any company who is more than willing to offer you help, it is equally essential that you not entertain any individual who knocks on your door once you file the notice of default.

Make sure a stranger is not allowed inside, thereby providing him a chance to make you a victim of his false assurances, incorrect figures and misrepresented claims. He will provide you a number of lucrative offers such as a reduced interest rate and monthly payment, but do not fall for these exaggerated claims. It is more than likely that he will collect a service fee and repayment and never come back to show his face again. This individual will ask you to stay away from the lending institution, which is exactly opposite of the correct course of action.

There are a number of trustworthy and creditable sources, which can offer you professional advice in dealing with this difficult situation. You could rely upon a number of certified counselors appointed by HUD. The services offered by these counselors are mostly free of cost and pretty effective. It is in your interest to check the credentials of anyone who approaches you uninvited, providing a sure-fire, rapid remedy for your problem.

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