How they work
The fraudster may use one of many ways to find homeowners who are in or near foreclosure. The victim may be found through newspapers or public records, others may be tempted by ads that they see in the newspaper, on television, or flyers found on the street. After receiving “personalized counseling” the victim will typically be given one or more options to choose from:
The victim thinks they have renewed their mortgage, but they have actually signed the title to their house over to the scammer.
The victim knowingly signs over the title of his/her house, with the assumption that he/she will be able to buy the house back after a few years. In the end the process is so difficult that purchasing the house is nearly impossible.
#3 Bankruptcy Foreclosure
The scammer agrees to negotiate a refinance plan with the victim’s bank for a fee rather than allowing them to go into bankruptcy. Often times, the scammer will pocket the money and file for bankruptcy without the victim’s knowledge. The result is a legal nightmare that costs a lot of money and may stay on your credit history for many years.