Foreclosure Scams

If you think an individual or company is running a mortgage foreclosure scam, you may file a complaint with the Federal Trade Commission (FTC) . If you think an individual or company is running a mortgage foreclosure scam that involves bankruptcy, you may contact the local office of the U.S. Trustee Program .

The Department of Justice (DOJ) and the FTC released the following information about common foreclosure scams to help homeowners facing foreclosure find legitimate help.

Foreclosure scams target people whose home mortgages are in trouble. Scam operators may:

advertise over the Internet and in local publications
distribute flyers
contact people whose homes appear in the foreclosure notices (they can easily find these notices online or in a local newspaper)
target specific religious or ethnic groups

If you are facing foreclosure, contact your lender immediately to see if they can help you renegotiate your current loan. Often, the lender is willing to work with the homeowner because they may also lose money if the house goes into foreclosure. You may also contact a lawyer for help. Your state or local bar association may be able to help you find affordable legal help .

These scam operators often promise to negotiate with your lender, help stop foreclosure by filing for bankruptcy or help make it easier to make payments by asking you to sign over your house to them and make smaller rental payments to them until you can afford to buy the house back later. They will then file for bankruptcy without following through with it, which allows foreclosure proceedings to continue so you may still lose your house and have a bankruptcy listed in your credit history for years.

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