FORECLOSURE RESCUE SCAMS

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					MORTGAGE FRAUD
     AND
 FORECLOSURE
 RESCUE SCAMS
       Presented by


    Catheryn Oakland
    Recoupment Counsel,
    Region C
                U.S. Statistics for 1906
    The year is 1906. What a difference a century makes. Here
          are some of the U.S. statistics for the Year 1906:

   The average life expectancy was 47 years. Two out of every
    10 adults couldn’t read or write. Only 6% of all Americans
    had graduated from high school.
   Only 14% of the homes had a bathtub, and 8% a phone.
   A three-minute call from Denver to New York City cost $11.
   Only 8,000 cars & 144 miles of paved roads existed. The
    maximum speed limit in most cities was 10 mph.
   Alabama, Mississippi, Iowa, and Tennessee were each more
    heavily populated than California, the 21st most populous
    state with a mere 1.4 million people. The population of Las
    Vegas was only 30! The American flag had 45 stars. AZ,
    OK, NM, HI, and AK hadn’t been admitted to the Union yet.
   Crossword puzzles, canned beer, and iced tea didn’t exist.
IN THE NEWS
                           Foreclosure Rates
                                                                             % change      % change
                                                           end 2006; % 1-
                                          Household Rate                         Jan 07        Feb 06
Rank               State    Total                                  yr.                                  Rank
                                               (1 per…)                           - Feb         - Feb
                                                                 Change
                                                                                    07            07




            U.S.              109,654              1,055             34.9          -3.91        11.64


       1    CO                  4,864                376            284.0          9.30         28.63          2


       2    NV                  2,213                392             96.0         24.36         77.40          1


       21   WA                  1,261              1,897             -20.2       -23.76        -19.32          20


       24   AK                      79             2,597             12.8        -19.00          9.46          31


       36   OR                      268            5,432             -47.5         0.55         -1.63          25


       49   ME                       6           108,649              0.0          0.00          0.00          49


       50   VT                       1           294,382             -83.0       -50.00        -50.00          50
Remain calm
even when it seems rather
       hopeless
  Options of Homeowner upon
          Foreclosure

 Reinstate   loan
 Refinance

 Chapter  13 filing
 Sell property at FMV
OR
Foreclosure Rescue
       Scam
           Definition:

A “foreclosure rescue scam” is a
transaction or set of related
transactions designed to prey upon
homeowners faced with looming
foreclosures. The scam artist’s
objective is to take the homeowner’s
equity without providing any
significant benefit.
                      Tactics
   Describing the transaction terms orally to the
    homeowner, but preparing documents containing
    different (less favorable) terms;
   Arranging for homeowners to sign incomplete or
    blank documents (then filling in the terms later);
   Using delay tactics to undercut the homeowner’s
    ability to utilize other alternatives;
   Adding exorbitant fees into the transaction;
   Withholding important documents and
    information from the homeowner.
          Recognizing the Scam
   I. Title

    – a. Foreclosure notices of record

    – b. QC or record to an unrelated party without
      consideration / excise tax paid

    – c. Request for supplemental title showing new
      vesting – deal may be proceeding in pieces

    – d. Request for Endorsement does not equal
      facts
   II. Escrow
     – a. Asked to prepare & close a QC to an
       unrelated party for no consideration
     – b. Recognize a “cast of characters”, including
       the one pressing the deal, appraiser, notary on
       docs
     – c. Docs don’t make sense. Why would
       homeowner agree to this? Deed with buy
       back?
     – d. Asked to close in pieces or record without
       full payment to homeowner
     – e. Transaction described one way does not
       equal docs
     – f. Excessive fees paid or inflated appraisal

				
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