AG Stops 2 Foreclosure Fraud Companies

The big warning lately has been to watch out for companies that claim they will help with foreclosure but end up leaving the victims in worse shape. New Jersey's Attorney General has filed charges against two Union County companies that appear to have taken advantage of their clients misfortunes. The companies are Property Solutions of NJ and PSRE Holding Company. In this article from The Jersey Journal titled State A.G. Says Loan Creeps Stole Homes we get a sense of what the company was doing. Let's take a look -

An 84-year-old Bayonne woman is among the victims of two Union City companies that promised to help homeowners facing foreclosure save their homes, officials say.

But instead of saving people's homes, the companies purchased the houses at deep discounts, saddled the owners-turned-tenants with even bigger monthly payments, and in a number of cases, including that of the Bayonne woman, evicted the previous owners, officials say.

...

The defendants typically approached people shortly before or during the grace period just after the scheduled sheriff's sale of the victims' properties, officials said. They convinced the residents to sell their homes to them for the amount they owed the bank, rather than what is generally a far greater sum arrived at in the auction, officials said.

The defendants offered to help save the victim's home by paying the balance of the homeowner's delinquent mortgage and then entering into a sale/leaseback agreement with the victim, officials said. But the monthly lease payments were often far higher than the mortgage payments the homeowner couldn't make in the first place and they were typically required to buy the home back within 90 days at a far higher price than the defendants' paid, officials said.

In the end, many victims either vacated or were evicted by the defendants, even if they made their payments, officials said.

At best with some of these scams people are paying thousands of dollars for useless services - at worst they are lose their properties, their savings and take a huge hit to their credit. Which is what sounds like happened to the 84 year-old victim. These victims are already vulnerable. Hopefully this deters others from taking advantage from an already bad situation and it will also alert potential marks about what to be on the watch for. Remember the warning signs - paying someone up front or signing over your property.