Officials passed out this sheet of consumer tips for homeowners facing foreclosure at the press conference yesterday announcing the bust of an alleged foreclosure scam.
Here’s a bit in the sheet about lease back schemes, which was one of the methods allegedly used by the defendants named yesterday:
Lease-Back or Repurchase Scams — Be very suspicious if someone offers to pay your mortgage and rent your home back to you. This scheme often involves signing the deed to your home over to the con artist. The con artist may promise to sell your home back to you, but this may be very difficult, if not impossible, under the terms of the contract.
Signing over the deed gives the con artist the power to evict you, raise your rent, sell the house, or steal the equity you have in your home. You will still be responsible for your mortgage, so if the con artist stops paying it, your lender would have the right to foreclose on your home, and the foreclosure and any other problems would go on your credit record.
The sheet has phone numbers and websites for finding government-approved counselors for homeowners in this situation.