Mortgages Loan Frauds

Obtaining a home loan can be difficult at times. That is why mortgages are so appealing to potential con artists. Learn how to recognize and avoid several types of mortgage fraud.

Complaints about mortgages
If you have a complaint about a mortgage or believe you have been a victim of one of the mortgage scams listed below, you have various options for reporting your experience:

• Make a formal complaint to us.
• Contact the Bureau of Consumer Financial Protection (Bureau of Consumer Financial Protection) (formerly known as the Consumer Financial Protection Bureau or CFPB)
• Make a complaint to the Federal Trade Commission (FTC)
• Contact the Department of Housing and Urban Development in the United States (HUD)
• Contact the Comptroller of the Currency’s Office (OCC)
• The Texas Department of Savings and Mortgage Lending is the place to go.

The Bureau regulates most banks, credit unions, lenders, and mortgage servicers. If your lender or mortgage servicer is state-licensed, you can also call the Texas Department of Savings and Mortgage Lending. You can also contact the OCC if your lender or mortgage servicer is a national bank.

The Texas Department of Banking may be able to assist you if you are confused about who governs your lender or mortgage servicer.

Mortgage Modification and Foreclosure Rescue Scams
These two sorts of scams can cost you thousands of dollars and maybe your home.

Scammers will pose as mortgage relief service providers to prey on homeowners facing foreclosure. The scammers usually promise to keep your property from foreclosure and cut your monthly mortgage payments in exchange for substantial fees. Instead of safeguarding your property from foreclosure, they may encourage you to quit contacting your lender and mortgage servicer, hastening the process.

Mortgage relief service providers are prohibited by federal law from seeking or receiving payment of any fees (or other incentives) for getting mortgage assistance before a mortgage modification or additional agreement with your lender/mortgage servicer has been finalized.

Mortgage aid relief service providers must, among other things, supply you with:

• a copy of the written offer from your lender/mortgage servicer; and
• A notice outlining the terms, conditions, and limits of the offer.
• You have the option to accept or reject the offer. You do not have to pay the mortgage relief service provider anything if you decline the offer.

Reverse Mortgages
A reverse mortgage is a loan for homeowners who are 62 years old or older and have enough equity in their house. A reverse mortgage loan allows some homeowners to access a portion of their home equity as cash while deferring repayment until they die, sell, or move out of their property. During the reverse mortgage loan period, however, borrowers are still responsible for paying property taxes and homeowner’s insurance.

A reverse mortgage is backed by a lien on the property and is normally repaid when sold. Although a reverse mortgage loan may not require principal and interest payment until the total amount is due and payable, interest will continue to accrue throughout the loan. Closing costs are also included in reverse mortgage loans and can be covered as part of the transaction.

The Dangers of Reverse Mortgages
Reverse mortgages appeal to certain seniors, particularly those who desire or need to supplement their income. However, use extreme caution before obtaining a reverse mortgage loan. Also, do not sign any paper that you do not comprehend completely.

Keep an eye out for:

• Scammers claim that a reverse mortgage is a government benefit when, in fact, it is a debt that must be repaid at some point.
• Scammers who promise investment opportunities and help with foreclosures and refinancing. Unscrupulous persons use a variety of real estate and financial services organizations to set up reverse mortgage scams to take the equity from the homes of naïve senior citizens.
• Recognize Your Alternatives
• Before selecting whether a reverse mortgage loan is right for you, be sure you grasp the loan’s terms as well as your other possibilities.

Mortgage Relief Scams to Avoid

• Companies that claim to help you avoid foreclosure should be avoided. Nobody can ensure that foreclosure will be avoided. It’s always a ruse.
• Scammers will also pretend to assist. However, they will take your money and not deliver. Learn more about how fraudulent claims of mortgage assistance are made by scammers.
• You don’t have to pay anything unless a company meets your expectations. That is the rule of law. It is, in fact, illegal for a corporation to charge you a dime upfront. They are unable to charge you until you have received it.
• a written offer from your lender for a loan modification or other form of relief – and you accept it
• If you accept your lender’s offer, you will get paperwork from them detailing the adjustments to your loan. In addition, the company must explicitly state the overall fee for its services.

Take Care of Yourself

To avoid being a victim of a con artist, take the following precautions:

• Keep in touch with your lender/mortgage servicer regularly.
• Never sign a document that you don’t understand completely.
• Consider consulting an attorney or a housing counsellor who the US Department has approved of Housing and Urban Development (HUD).

Are you in danger of losing your home to foreclosure?

Consider one or more of the following steps:

• For immediate assistance with foreclosure prevention options, contact your lender/mortgage servicer. Your mortgage servicer or lender may be able to assist you in avoiding foreclosure. To ensure that all of your foreclosure prevention alternatives are retained, you must contact your lender or mortgage servicer as soon as possible.
• For free or low-cost foreclosure counselling, contact a HUD-approved housing counselling agency by dialling (800) 569-4287 or visiting HUD’s website.
• Call the HOPE Hotline for Homeowners at (888) 995-HOPE (4673).
• Consider hiring a lawyer to help you through the foreclosure process. This website has a list of legal clinics that provide free legal assistance, or you can call the Texas Attorney General’s office at (800) 252-8011 for a list of legal clinics.