There is just about every type of scam you can imagine in every industry sector that currently exists, including the mortgage industry. Homeownership is just one of many American Dreams that are a source of enjoyment and pride. However, the whole process is cumbersome and tedious. That is why it is essential that you consult with experts today. Unfortunately, there are certain unscrupulous individuals that are always developing scams and schemes to rob you of your hard-earned home and income. Here are 3 of the most common mortgage industry scams and how you can avoid them.
3 Common Mortgage Scams
Foreclosure Relief Scams. If you have ever had the misfortune of falling behind on your monthly mortgage payments, you could be desperate about saving your home. Sadly, mortgage scammers prey on those individuals and use public records to find homeowners that are in pre-foreclosure. They typically pose as Federal Government housing assistant reps and promise to reduce those monthly payments provided you can pay them a large upfront payment.
They may even convince you that paying them your monthly mortgage payment for a year will ensure you don’t fall into foreclosure. Contact your mortgage lender about your financial state and asking for a loan forbearance or modification will help to protect you against this type of mortgage scam.
Home Title Fraud. Another one of the most common mortgage scams is home title fraud wherein a scam artist obtains the title to your property and then transfers ownership into their name. They do this by stealing your identity and secure numerous loans by using your home equity. The scammer pockets all of those loan proceeds and the lenders begin calling about past due payments and foreclosure. You can avoid being a home title fraud scam victim by frequently checking for suspicious activity on your credit score. Also, watch for the absence of certain mortgage-related bills such as property taxes and water bills.
Mortgage Transaction Wire Fraud. Some scam artists access the personal information of individuals who are in the midst of a home-buying transaction and create an extremely convincing e-mail, phone call, or text message that explains where you need to wire your escrow funds. These scam artists usually claim that they’re from your escrow or title company. Once you wire them the funds, they take that money and put it in an untouchable off-shore account. You can avoid this scam by verifying your lender’s information. Also, be wary of any digital requests for changes to the wiring process.