With all of the folks in financial trouble and the numbers of home owners upside down (owe more on their mortgage can they can sell the home for), a new industry and many new scams are popping up.
Mortgage modification, renegotiation or restructuring is the new buzz. Franchises are being sold, seminars are being held and spams are flying around the internet. The next wave of prosecutions is probably a year or two away, once enough of the public are taken advantage of. I am sure there are legitimate companies out there, but the public better beware.
If you are in a desperate situation and you need to either restructure your mortgage or go into a short sale or seek some other form of relief; be very, very careful. There are charlatans are every corner. Beside the "We Buy Homes" scammers there are several new groups popping up including "Mortgage Modification Services." I am sure there are some professional organizations that are good at what they do. There are many, many more scam artists looking to take money from you.
Yesterday I attended a seminar hosted by a local escrow office. Once it began we quickly realized it was a sales pitch for a service. The service actually operates out of state and claims to be utilizing attorneys. Being out of state puts them out of reach of our state regulatory agencies. The very same problem we run into with out of state lenders. If they do something improper, you have very little recourse.
If you are in this situation and need legal advice seek a local attorney.
If you need Hawaii real estate advice, give me a call or an e-mail. If I can not help you, I can point you in the right direction. What ever you do be careful and look for the appropriate professionals.
I hope you stood up and said something.....I really wonder where this is going to lead. All these people claiming to be short sale experts and not realizing that they are NOT doing it the right way...... Out of state...out of mind huh?
People need t be protected from the unscrupulous. It should not take a year for the law to catch up with those who would seek to take advantage of people already hurt and hurting.
Sally - I was surprised because it was hosted by an escrow company.
Eloise - Just think they still haven't gone after many of those responsible for mortgage fraud. They haven't gone after the top folks at Fannie and Freddie who cooked the books to take millions in bonuses. Heck they made them advisers to one of the presidential candidates.
Randy - that is so true. There are many people out there trying to take advantage of desperate home owners.
Anything to make a buck.
This is great, I think at this time we need an AR SCAM ALERT section...we all are seeing unusual practices that could really destroy lives. Thanks for being such a professional.
Do you recommend a restructure to start with the original financial institution or should they shop out this like a normal refi ? How does a homeowner qualify the restructure program to limit being sucked into a scam ?
Randy,
My spam filter has sorted out a few dozen solicitations for mortgage modification business in the last few weeks.
Spam is the canary in the coal mine... First warning about a new scam.
The wave of scamming is just beggining. It's a great oppoturity for those who purported to be able to help folks avoid foreclosures.
Jeff
Randy,
It is a shame but yes, the scammers are out in full force. So sad, but when people are scared they are more vulnerable.
Venancio - It is the Wild West out there.
Neal - Sad, but true.
Michele - I am looking into this whole thing more. Because of a new state law, real estate agents are not allowed to contact the lenders on behalf of their clients. The rules have changed tremendously. I and my brokers are attending a session this morning with the attorneys from the Board of REALTORS®. I am hoping to have better clarity on what we can do and what we should be recommending.
Mike - That is a great point. Spams are a warning of new scams.
Jeff - I see it coming. I am already sick of seeing signs stuck to poles and trees along our roads from these scammers.
Cynthia - I am amazed that these folks keep trying to get us to help them. That tells me there are agents being suckered by them also.
Randy, what's so sad is that there really is a need for people to provide real services in this area. And it says something about the banks, who should not be so unresponsive that their customers even need a middle man.
Randy, I just run into this yesterday. One of my past clients called and asked me about it. That phone call saved his butt!
What a crazy time we are in, Randy.
Randy every hardship is an opportunity for the scum to rise and try to take advantage of the innocent. Anyone who needs to modify their mortgage, needs to talk to a Lender that they know to be reputable and who they can talk to face to face.
Patricia - You are right. The banks have been through these cycles before and have learned nothing.
Erica - It seems to get crazier every day.
George - I agree, they need to seek out professionals.
I am so sick of these people showing up at home owners doors and then having to calm the seller down and get them to stop crying when they use fear tactics to try to get them to sell their home or pay them on the spot to get the problem to go away.
It really is sad!
Wow- even with seller permission in writing you can't contact their lender?? How does that make working toward a solution for your client easier? Is it simply to protect sellers from having a scammer access their info? Things just seem to get more and more complicated- without access to a distressed sellers lender (and direct dialogue) our attempts to assist would be missing a huge "link", creating more havoc for both buyer and seller.
Someone should really consider putting an seminar for the new law in Hawaii regarding ACT 137. I wonder how that will affect realtors who currently have short sale listings or in the process of dealing with some.
I would think that the title co who sponsored it would have been embarrassed!
Todd - I am sick of the predators also.
Laurie - Our legislators did exempt attorneys. Most of them are attorneys. The sad part about that is almost no attorneys will take them on and the few that will mostly want to be paid up front. People in that situation normally do not have money for an attorney.
Linda - Friday there was a presentation at our Brokers Forum. There is also a seminar coming up put on by an attorney.
Terri - I would be.
Thanks for the warning, Randy. Looks like something we all should be pointing out to our clients?
Margaret - The predators begin circling every time they smell blood.
Randy - you're right. Unfortunately there are always people trying to take advantage of other people's misfortunes. When someone is "out of state" from Hawaii, that's really far away!
Sharon - That is for sure. We can't easily look them up if they are out of state.
Randy, I had one of these guys selling this jive on the phone to a client while I was there for dinner. I do not know about Hawaii, but in SC it is clear that a banker or agent can not consider signatures valid nor discuss fiduciary concerns if the party was under the influence. So, why call at 8:30 while in the middle of a good bottle of wine?
Jane - Here they call at 4:00am from the mainland. They do not know what time zone we are in, yet they claim to be experts in our market.
Hi Randy, Isn't is a shame the there is always something new that the consumer must be aware of? Thanks for the great post - and we have started see that kind of thing here too.
Sandy - It is a shame.
I wouldn't generalize that all loan modifications are scams as that isn't the truth. If a homeowners wants to keep their home, needs help with their loan and understands what to look for then this is a great avenue for them to look into.
As in any business their are unethical people but there are also very serious and professional people who are helping homeowners save their home. The key is for the homeowner to be educated.
Maybe vs. generalizing you could meet a couple who provide this service, learn and understand about it and then refer your clients.
If more Realtors, thought about helping clients save their clients home vs. rushing to a short sale think who that client would call when things turned around.
Kelly - I have spoken to several offering this service. I will let you know when I meet a reputable one. Also in the state of Hawaii it is illegal for real estate agents to perform that service under most circumstances.
You make a very good point, I have not seen any scams i know of yet but I bet they are out there. Thanks for the post.
Randy,
These mortgage workout scammers are everywhere now, so the public ought to be very cautious. Any time they ask for money up front is a red flag and the outfit should be thoroughly checked out.
Randy
Whenever people are suffering there will always be someone there trying to squeez them for more...sick.
Joey - Keep your eye open, I have seen several of them.
Esko - The money up front is a red flag for all scams.
Trey - Sounds like politicians. LOL