Mortgage fraud- avoid being ripped off

Low interest rates and rising prices of homes inspired many consumers to satisfy their American Dream. However, it has also led to the increase in the number of predatory lenders. According to an authentic reporting agency “Nearly 19 percent of all loans to less credit-worthy consumers, or 1.1 million mortgages, were either delinquent by more than 30 days or in foreclosure.”

Just as the number of con artists is on the rise, more and more houses are facing foreclosure. Earlier the number of houses facing foreclosure was on the rise due to the delinquencies but these days the number of foreclosures due to homeowners being ripped off is also on the rise.

It has been observed that majority of the homeowners that are taken for a ride includes ignorant consumers. There are many ways by which you can avert being ripped off. Some of the measures are given below –

• If you receive a “deficiency notice” from the lender, talk to your lender so that the problem can be resolved at the earliest.

• When you are behind on payments, don’t take help of an individual or a company that claims to get you out of the financial mess

• If you think there is a necessity, talk to a counseling firm that can show you the way to solve your financial problem. Make sure the counselor is approved by the Department of Housing and Urban Development or HUD.

• Avoid signing a quit claim unless your attorney asks you to do so

• Avoid entering into contracts that will allow you to buy your house later after you sell it once to the “rescuers”.

• In case your lender is not cooperating with you, get a forensic loan audit done. The report will help you to find out if there are any irregularities in the mortgage you have taken out.

Mortgage fraud has become so rampant in the different states in United States that it is catching up fast and not many laws have been passed as yet that can arrest the anomalies in the mortgage market. For instance, 7 states have passed regulations to arrest bailout mortgage fraud and equity stripping.