Thursday, May 18, 2006
Massachusetts Attorney General Investigates Foreclosure Rescue
Massachusetts Attorney General Tom Reilly is investigating several individuals and businesses who allegedly target Massachusetts homeowners by offering to “rescue” them from foreclosures, but instead trick them into deeding over their property. In many instances, homeowners have lost their homes and the equity they had built.
“Foreclosures are on the rise in Massachusetts, and families facing foreclosure are often desperate to find any way possible to keep their homes,” AG Reilly said. ”Many of these vulnerable families are falling prey to unscrupulous individuals and businesses who deceive them into deeding over their homes with false promises to ‘rescue’ them from foreclosure. I will not allow these practices to continue, and I will hold those responsible for these schemes accountable.”
Because information about pending foreclosures is publicly filed, unscrupulous businesses and individuals can purchase information to target homeowners for these “rescue” schemes. Homeowners receive letters, telephone calls, and even visits from individuals or firms offering to help avoid foreclosure through “sale-lease back” arrangements, “interim ownership contracts,” special “financing,” and other deals. The business or person offering help, the “rescuer,” will generally make a payment to the foreclosing lender to get the homeowner’s mortgage current and to avoid a pending foreclosure auction. Typically, these arrangements require homeowners to sign over their homes, with the promise that they will be able to buy their homes back later. However, the actual terms of these arrangements make it difficult and, in some cases, impossible for homeowners to reclaim title to the home.
Also today, AG Reilly issued a consumer advisory to homeowners facing foreclosure, warning them about these foreclosure “rescue” scams, explaining how to identify a scam, and setting out actions they can take to protect themselves.
AG Reilly also called on homeowners who think they have been victims of a foreclosure “rescue” scam to immediately contact his office by calling the AG’s Consumer Hotline at (617) 727-8400.
“Families in Massachusetts are being squeezed on all sides - from soaring gas prices to utility and health care costs.” AG Reilly said. ”Now as foreclosure rates are going up, we’re hearing complaints about companies taking advantage of people who are trying to save their homes. Consumers need to be careful. I urge homeowners facing foreclosure to talk with licensed professionals, including lawyers and real estate professionals, before entering into any agreement or arrangement involving their home.”
The consumer advisory warns consumers as follows (and note that these scams are not unique to Massachusetts but are happening all over the country!):
Mortgage foreclosures are on the rise in Massachusetts. If you are facing foreclosure of your home, Attorney General Tom Reilly wants you to know that unscrupulous businesses or individuals may be targeting you. They will offer to “rescue” you from foreclosure, but are just trying to steal your property by tricking you into transferring title to your home.
Many offers to “rescue” your home from foreclosure are scams - be on your guard!
Promises such as “we can help you save your home,” “we’ll buy your house and sell it back to you and improve your credit,” and similar offers sound too good to be true, and they are!
* Homeowners facing foreclosure are being targeted. Information about pending foreclosures is publicly filed, and unscrupulous businesses and individuals purchase that information so they can target homeowners for these foreclosure “rescue” schemes. You may get letters, telephone calls, or even visits from individuals or firms offering to help you avoid foreclosure on your home through “sale-lease back” arrangements, “interim ownership contracts,” special “financing,” or some other deal. These “rescuers” agree to make a payment to the foreclosing lender to get your mortgage current and to avoid the pending foreclosure auction. However, they typically also require you to sign over your home, with the promise that you can buy it back later. But when you sign the papers, the actual terms will make it difficult or impossible for you to reclaim title to your home. At the end of the day, you may end up losing your home, and any equity you have built up in your home.
* If you are facing foreclosure, seek advice from trusted professionals. Never enter into any agreement or arrangement involving your home without consulting with a trusted advisor. If the person or firm offering to “rescue” you from foreclosure tries to dissuade you from seeking independent advice, then it’s likely a scam!
Warning signs
There’s a good chance you are being targeted for a foreclosure rescue scam if:
* You did not initiate the offer—you did not call anyone, and did not think anyone knew about your financial problems; or
* You’re getting counseling only from the person who is offering to help; or
* You’re being pressured to agree to the transaction right away, without consulting a lawyer, an accountant, your current lender, or family members; or
* The business or individual promising to save your home from foreclosure rushes you through the transaction and urges you to sign documents without reading them; or
* The business or individual requires you to deed over your home, and promises that once you’ve caught up with the past due mortgage payments, or after a one or two-year period, your home will be signed back to you; or
* The business or individual you are dealing with is not a licensed or chartered bank or lender. (Check with the Massachusetts Division of Banks.)
Protect yourself
* If a business or individual contacts you to offer to save your home from foreclosure, check their status. Is the business a lending institution? If so, is the lender licensed by the Division of Banks? If not, what type of services is this business providing you? Do these services sound too good to be true?
* Do not sign a deed to your home unless you are actually planning to sell your house. (If you are refinancing your home, you do not need to deed your property.)
* Seek the advice of a lawyer or real estate professional before you enter into any transaction to save your home.
* Read every document you sign, and do not sign documents if you do not understand what they mean.
* If you are behind in your mortgage payments and need help, contact your lender first. It is possible that the lender can work something out with you. If you decide that you cannot afford to keep your home, a foreclosing lender may provide you with additional time to list your home with a real estate professional to help you get the highest sale price
Contact information for Massachusetts agencies is also included in the consumer advisory.
mortgage fraud
Hello,
My name is Jason Kaliloa, I was looking for some advice or direction as to what needs to happen if someone is deeding a house over in my name. My uncle recently got pressured by a mortagage company into signing a refinance with a $6,037.00 monthly payment in an attempt to pay his credit cards off in hopes to raise his credit score and proceed to refi again to lower his monthly payment. My uncle is now at a point where his credit score has not improved and is unable to pay the monthly payment. He has proposed on deeding his home over to me in hopes that I could get a better rate and allow him to still live his lifestyle of being in the house. I dont know how this works or what I would need to do to get the ball rolling. If you have any advice or solutions to this matter please let me know. Thank you so much. Jason
Posted by on 07/02 at 10:20 AM
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Trial coverage provided by Anne Mitchell, Crazy Fish Realty.
F. Jeffrey Miller Update - October 20, 2009
A hearing was held in Topeka, Kansas in front of Judge Julie Robinson. Miller is currently being held pending his sentencing which is set for December 22nd, 2009 at 9:00 a.m.. Steve Vanatta and Hallie Irvin, Miller's codefendants, will be sentenced at that time also.
Several motions were heard this week. One was a motion for Miller to be released pending his sentencing. Miller's attorney, Jeff Morris, argued that the court had dismmissed with predjudice the matter involving Miller's purchase of a commercial lawnmower, violating the court ordered monitoring agreement. He also argued that Miller was not a flight risk and should be released. This motion was denied.
Another motion heard by Judge Robinson was that of an escrow account containing proceeds from the sale of Miller's forfeited assets. This account has a balance of $143,000. Attorney Morris argued that his firm was due $100,000 for work done in the Miller matter, to date. The government argued that his 'un-itemized fees' were 'exhorbitant'. The balance of the funds, Morris argued, should be released to the Miller family to help pay for mounting household expenses.
The government argued that the 'Asset Forfeiture Provision' applies down to 'the last penny' and that 'the rights of the victims to made whole are of paramount immportance' and that no routine household expenses like Visa bills, are allowed.
Attorney Morris argues that there is more than enough assets to satisfy the jury's judgement of $2.65 million dollars. The government argues that the estimated value of his assets are only $1.4 million.
The government also stated that Miller has been paid dividends from a company Miller has an ownership interest in; Boreflex. From July, 2008 to present, Miller has been paid $330,509.30 from Boreflex, unbeknownst to the court appointed monitor.
Present in the courtroom was Todd Earnshaw. Earnshaw was indicted along with Miller and others in what is commonly referred to as 'Miller I'. That trial is scheduled to begin on January 11, 2010 in Topeka, Kansas.
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Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
