By understanding how the foreclosure process works and knowing where to go when facing this situation, you can easily avoid scams. It is very stressful when dealing with financial struggles and the inability to pay bills and mortgages. A lot of the time people feel overwhelmed and are not sure what options they have. When in this delicate state, it is easy to fall into the trap of a foreclosure scam, but rest assured, there are tips to help you avoid such a disaster.
Be Wary of Too Good to Be True
If the deal being presented to you sounds too good to be true, then it most likely is. Always trust your gut and follow your instincts. When this situation presents itself do not go with that representative or company. Afterward, you should report any schemes that you come across to the authorities and the consumer protection groups. Once aware, these agencies can shut the scams down and potentially protect numerous other potential victims.
Understand the Foreclosure Process
Most people have to work with a service during the foreclosure process. Be cautious of any company or representative that promises they can stop the proceedings tat are already in progress. The foreclosure process does not work that way. Foreclosure counseling does not make the proceedings disappear. They are provided as a way to help analyze your budget and work with lenders hopefully bringing both parties to an agreement on a mortgage payment to satisfy everyone. The purpose of seeking foreclosure counseling is to keep your home while the lender still gets paid.
Read Before You Sign
As is true with any legal proceeding or contract, you need to read everything before signing. That includes the fine print. Foreclosure scam artists rely on pressure and scare tactics to get people to sign quickly. They prey on those who are in desperate financial situations. Always read every document given to you and if they are not presented to you, a big red flag should go up. Always ask questions and if your questions are not answered, do not sign anything until you have consulted a lawyer.
The Cost Will Be Your Key
For the most part foreclosure counseling is free. If there happens to be a charge, it is minimal. Never pay a company or representative that is charging a lot of money. Their scam relies on getting large funds from you up front, but if you know that the counseling should be free, you can walk away as soon as big money is mentioned. The most reputable foreclosure counseling firms are funded by the Department of Housing and Urban Development HUD), so there is no need to charge huge fees.
Locate a HUD Approved Counselor
The best place to start when it comes to a foreclosure is by finding a HUD website and representative. They are guaranteed to be legitimate and reliable, keeping your interests at the head of the proceedings. When you work with an HUD counselor, you can be sure there are no scams.
Facing a foreclosure is emotional and stressful, making you a prime target for scam artists. Looking to take advantage of your vulnerability they will pressure you into a deal that you will regret. Following these five tips will help protect you from becoming a victim of a scam. The est way to avoid a scam however,is to prevent it from happening in the first place.
The best way to do this; sell your house before it goes into foreclosure. A real estate investor can buy your house in a pre-foreclosure sale and you get cash right away. These sales are quick and houses are taken as-is, so there is no need for repairs. Avoid scams altogether, and contact a real estate investor when foreclosure is looming.