One of the cruelest scams perpetrated by greedy and unscrupulous people is to kick other people when they are down. Thousands of New Yorkers who are in danger of losing their homes through foreclosure have been preyed upon by foreclosure relief companies and attorneys who tout foreclosure rescue schemes to desperate, trusting and unsuspecting homeowners who do not discover that they have been fleeced until it is too late. This is a double injustice to some of these homeowners who were initially granted mortgage loan approval when it was obvious that they did not have the capacity to repay the loans.
New York State Attorney General Eric Schneiderman’s office and its affiliated partners are here to help those who have been victimized or who are in danger of falling prey to foreclosure scammers. Beginning in 2012 and supplemented by such efforts as the December 2016 Foreclosure Rescue Scam Prevention Effort, the HOPP (NY Attorney General Homeowner Protection Program) alerts homeowners to scam tactics and refers homeowners to a network of housing-counseling and legal-services agencies in their areas. The help is provided free of charge. Call 855-HOME-456. Funds come from bank settlements received by the Attorney General from the federal-state mortgage-backed securities working group: New York has received $5.5 billion of the $95 billion that has been received nationally.
AGScamHelp.com is managed by the Center for NYC Neighborhoods, which is a non-profit organization under contract with the office of the New York State attorney general. Go to the website and check out a foreclosure relief company to ascertain if it has been vetted by the government. Enter your zip code if you need assistance and you will receive names of up to five organizations in your area that are affiliated with HOPP. You can also report a scam by filing a complaint with the attorney general’s office (ag.NY.gov/consumer:frauds/Filing-a-Consumer-Complaint).
The New York State Mortgage Assistance Program is an enhancement to HOPP. It provides a mortgage loan at 0 percent interest of up to $40,000 to people who are at risk of foreclosure and have exhausted all other resources to prevent the foreclosure. This program is administered by the Center for NYC Neighborhoods, which is a non-profit organization dedicated to promoting and protecting affordable home ownership. Loans are made by Sustainable Neighborhoods LLC, which is a wholly owned subsidiary of the Center (cync.org).
Why are these small loans of vital importance? Attorney General Schneiderman discovered that homeowners, who are often employed and generating income, cannot qualify for loan modifications that can prevent foreclosure because the homeowners might have small debts, missed mortgage payments or unpaid property taxes. All of these debts must be satisfied before a loan modification can be granted by the lender. A great benefit to the homeowner is that, during the state-aided process, when the homeowner works with a HOPP counselor or legal aid provider, the homeowner will not be foreclosed upon. Thus the homeowner need not be frightened by scammer companies who threaten the homeowner with imminent foreclosure. Go to www.nysmap.org or call 855-HOME-456 for program details and to learn if you qualify for the program.
Unscrupulous loan modification companies often use aggressive pressure tactics to frighten homeowners who are in danger of foreclosure. Homeowners should beware of the following: If they are approached by a loan modification/foreclosure relief company then they must not provide personal information such as social security numbers, bank account numbers or the names of their lenders. The attorney general reports that the most common scam involves a company’s offer to negotiate with the lender while promising great results for the homeowner—all for a fee, of course. This is a scam because no company can guarantee success in negotiating a loan modification and because charging upfront fees for loan modification services is almost always illegal in New York State. The most that a legitimate company can promise is that it will do its best to secure the modification.
Scammers may instruct their desperate victims to stop paying mortgage payments to their lenders and instead remit these payments to the scammer’s company or to a third party. Always send your payments only to your lender! Scammer companies may pressure homeowners to sign documents that the homeowners do not understand, including signing over the deed or mortgage to their properties to the scammer company or to a third party. Never sign over your deed! If you don’t understand a document then consult an attorney or get help from the attorney general’s partner organizations! You can also go to the U.S. Department of Housing and Urban Development website for a list of approved housing agencies. Finally, beware of attorneys who bring frivolous lawsuits so that they can bill homeowners.
By Vivian J. Oleen
Vivian J. Oleen is an associate broker at Sopher Realty.