How Understanding Foreclosure Can Help Homeowners Avoid Scams
Jun. 19, 2017
Falling behind on mortgage payments can be stressful and traumatic, leading some homeowners to fear that they’ll automatically lose their homes to foreclosure. That simply isn’t true.
Unfortunately, there are a lot of sham companies and dishonest people looking to take advantage of homeowners stressed out by the prospect of foreclosure by charging them hundreds or thousands of dollars in fees.
That’s why an understanding of how foreclosure works in New York State may be one of the best weapons against scams.
Foreclosure is a legal process that can last years
The road to foreclosure in New York State is a legal process that takes over two years (on average) and involves a series of court appearances and procedural protections for homeowners. And, in the end, not all foreclosures result in the loss of a home. Only 20 percent of properties in New York City are sold through an auction or transferred to bank ownership. That means 80 percent of homeowners find other solutions.
One of the top solutions is to get a mortgage modification. But that, too, can be a source of frustration and anxiety for homeowners. Nationally, homeowners seeking mortgage modifications have reported serious issues with their mortgage servicers when seeking to avoid foreclosure and modify their mortgages. Complaints include: difficulty communicating with servicers, receiving conflicting information from customer service representatives, and having to resubmit documentation unnecessarily.
Because so much confusion surrounds how foreclosure and mortgage modifications work, it makes it easy for scammers to exploit the vulnerability of homeowners in crisis. Fraudsters often track foreclosures by using easily accessible real estate market trend tools and by employing a variety of means to contact homeowners by mail, phone or even through door-knocking campaigns. It can also be difficult to identify these scammers from organizations that provide legitimate help; scammers’ marketing materials are often professionally produced, and they may even have attorneys who work for them.
You have time to get help — real help
While it’s understandable that homeowners who have fallen behind on their mortgage are fearful that they might lose their home to foreclosure, it is worth keeping in mind that there is often time to seek free, legal help instead of turning to paid services.
The New York State Attorney General’s Office has created a network of community-based legal and housing organizations that may be able to help homeowners to get out of foreclosure and find relief. They don’t charge fees, and their only promise is to work hard on behalf of homeowners.
Visit AGScamHelp.com or 1-855-HOME-456 to get connected to one of these organizations in your local community. Created by the AG’s office and the non-profit Center for NYC Neighborhoods, you can also use the tools at AGScamHelp.com to vet organizations you may have worked with.
Remember: It’s never too late to seek out help and to try to save your home.
Don’t forget to be a good neighbor, and pass it on.