Foreclosure Scams

As the number of struggling homeowners increases in California, the number of scams waiting to take advantage of those homeowners has increased as well. The services offered to desperate homeowners range from those who offer to renegotiate their loan in exchange for thousands of dollars, to those that offer, for a charge, to assist a homeowner in obtaining a property tax reassessment, a free service provided by county assessors.

The following are a few samples of the types of scams that have been reported:

• Foreclosure specialist — Offers to renegotiate the homeowner's loan for several thousand dollars. None of the actions save the home and the homeowner is delayed from seeking qualified help.
• Lease-back schemes — A homeowner is persuaded to sign over their deed to a third party, and to lease back the property with the option of purchasing it back. The terms are usually so demanding that buy-back becomes impossible.
• Bait-and-switch — Homeowners sign documents that they believe bring the mortgage current, but instead sign over the deed to their home.
• Stalling foreclosure and short sale — Charging substantial advance fees for a short sale, delaying foreclosure, or assisting in property tax reassessment.

More Information

The California Attorney General
6 guidelines to help you avoid foreclosure scams.

The Federal Reserve Board
5 tips to help you avoid foreclosure scams.

The U.S. Department of Housing and Urban Development (HUD)
Warning to California Residents about potential scams and con artists.

IF YOU TRANSFERRED YOUR PROPERTY OR PAID SOMEONE TO "RESCUE" YOU FROM FORECLOSURE, YOU MAY BE A VICTIM OF A CRIME.
Please register a complaint with the Attorney General’s Public Inquiry Unit or by calling (800) 952-5225 (TTY (800) 735-2922).