Signing
Over the Deed
Posing as "foreclosure
rescuers," unscrupulous individuals and deed transfer companies target
seniors and lower income homeowners on the brink of foreclosure.
Typically, they promise to bail homeowners out of foreclosure by paying
off the arrears on the outstanding mortgage and to continue making the
payments for them while charging them rent.
Part of the deal involved
the homeowners signing over the deed to their home to the
company, and are told they may rent their home until they are able to
buy it back. The purchaser, however, has no intention of leasing the
property back to the homeowner. Instead, the purchaser evicts the
homeowner within months after the transaction and walks away with equity
the homeowner had built up - sometimes as much as hundreds of thousands
of dollars.
Unfortunately there is a growing number
of these 'deed theft' scams throughout the country. While
these so-called 'foreclosure rescue specialists' imply that they
will help the homeowner, the actual result is that the consumer is often
defrauded, losing not only their home but all of the equity they had
built up in the house. Some states are developing legislation to help
ensure that homeowners have statutory protections from these types of
abusive deals.
What is Deed Theft?
Deed theft scams usually involve
homeowners at their most vulnerable-those who are in default or who are
facing foreclosure and are becoming a serious epidemic in some states
including New York. Low and middle income homeowners who are
targeted lose all of their equity and are evicted from their homes,
while unscrupulous speculators who are completely unregulated by the
state are stealing millions.
Deed theft is also perpetrated on
homeowners when they go to close on a refinancing mortgage. Buried in
the thick pile of papers signed at closing are documents that authorize
transfer of the deed to a third party. In these instances, the homeowner
does not even know she has ceded the deed to another party until
considerably after the fact.
Wherever you go in the country, it's the
same horrible set of facts: seniors and lower income homeowners, who are
in a desperate situation, unwittingly sign over the deed to their homes
to scam artists who promise to bail them out of foreclosure.
Sometimes, the homeowners are even aware of what they have signed but
are desperate to keep their homes and trust these companies.
All too often however, they realize they
no longer own their homes and that the entity to which they signed over
their home has no intention of ever selling it back to them.
What You Should
Do...
If you are in or heading into foreclosure
and are looking to an investment company to help "bail" you out, keep in
mind that there are a few legitimate investment companies out there that
will not scam you out of your home.
Ask for references, check the Better
Business Bureau, call your state Consumer Affairs to see if complaints
have been lodged - just research the company extremely well. Then
have a trusted real estate attorney review all the documents AS YOU ARE
SIGNING them. This may cost you a few hundred dollars but it could
be the difference between saving or losing your home!
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