Beware of Foreclosure ScamsRemember, if anything sounds too good to be true, it usually is. There are a lot of people that try to take advantage of people in bad situtations such as predatory lenders and real estate cons.
These lenders focus on people in financial distress and try to get people into high interest rate mortgages with high broker fees and unrealistic repayment terms. The mortgages end up getting people into worse situtation by owing more money.
- Bargain Loans - Face it, if you are in a foreclosure situtation, even a reputable lender will not be able to get you a bargain loan unless you have some special relationship with the lender. Be very wary of anyone offering you these "bargain loans" whether it is through mail, e-mail, fax or come to your home.
- No Credit, Bad Credit Loans - Beware of advertisements of loans for people with no credit or bad credit. These loans typically are good for the first few months but after the initial period, the interest rates can jump by double or even triple the amount.
- Don't Sign What You Don't Understand - Even though you are facing foreclosure, don't just start signing contracts left and right. You can be signing your home away without even knowing if you don't read closely.
- Credit Counseling Agencies - Once your foreclosure information becomes public (after the lender files with the city), you can expect calls from potential phony credit counseling agencies who try to offer you services with promises of getting out of foreclosure for a high fee. Take advantage of governmentapproved agencies instead.