For the past few years, homeowners have been scammed in the housing crisis. Predatory lending, subprime loans, inflated purchase prices, equity skimming, deceptive, discriminatory and unfair lending practices, excessive fees, forced-placed insurance and other “packing” fees are just a few of the tactics and scams that have been played on homeowners.
Banks are, and have been exposed for illegally foreclosing on homeowners. These are the same banks that led to the housing crisis with their predatory lending and other unfair practices.
Now comes another group to further scam the already scammed homeowners, the “Foreclosure Rescuers”. All over the internet, ads are popping up and mailboxes are filled with flyers with claims of being able to “rescue” homeowners from their mortgages, getting home modifications and negotiating short sales. These mortgage foreclosure scammers have surged 60% in the wake of newly launched federal programs. They offer promises to lower your mortgage payments, work with your lender, own your home without paying another penny and how to avoid foreclosure.
In May, 2012 alone:
Marien Brown, owner of 1st Federal Resource, LLC and First Financial was sentenced to jail. She targeted homeowners who were one or more mortgage payments behind, or in danger of being foreclosed on. Homeowners sent in tens of thousands of dollars that were converted to the owner’s private account instead of the homeowners’ mortgage companies. The company advertised themselves as ‘mortgage rescue and foreclosure rescue’ business.
Another company TLW Mortgage Solutions, was charged with five counts of felony. Owner, Tashia Winstanley, allegedly collected upfront fees and impersonated a mortgage modification company.
K&R Marketing LLC doing business as Fix My Mortgage Problem is the subject of a civil lawsuit filed May, 2012. The lawsuit charges multiple violations of the Debt Adjusters Act by offering loan modifications and charging fees greater than the law allows.
Braunstein & Associates and Expert Financial, both owned by Rickey White, faces criminal charges for an extensive foreclosure-rescue fraud operation that scammed victims out of at least $800,000. This company allegedly told victims his companies employed expert attorneys who would review their lender files and assured clients his attorneys would file modification proposals on the homeowner’s behalf. Investigation revealed White allegedly had no attorneys on staff, modification proposals were either incomplete or never submitted to banks.
Frederic Gladle was sentenced to 61 months in prison for his role in operating a foreclosure rescue scam and admitted to collecting more than $1.6 million in fees from distressed homeowners.
In Colorado, a Civil Action brought jointly by the United States Attorney’s Office for the District of Colorado and the State Attorney General of Colorado finally put a stop to a scam that lasted nearly two years, beginning in March 2010. Bella Home LLC promised distressed homeowners they would help homeowners avoid foreclosure. The Civil Action resulted in a Consent Judgment in which Bella Homes “admits the allegations in the Complaint and acknowledges its role in defrauding homeowners who signed over title to their homes to them”.
Bella Homes solicited homeowners to convey their home title to them without any consideration and would enter into a “lease agreement” with the homeowner. The homeowner would stay in their home and pay “rent” to Bella Homes (the new “owners”) instead of a mortgage payment. To entice homeowners, Bella Homes gave the false and fraudulent impression that they’d stop any foreclosure on the home; would purchase or otherwise settle the existing mortgage on the home from the lender and in three years the homeowner would repurchase their home back from Bella Homes at an amount lower than their mortgage. The complaint alleged that Mark Stephen Diamond, Daniel Delpiano, David Delpiano and Michael Terrell were involved in running Bella Homes.
The old adage “if it sounds to good to be true it probably is” comes into play here. Unfortunately, when a homeowner is desperate and wants to believe in any means to help fix their dire financial situations, they fall prey to these unscrupulous so-called rescuers.
Whenever a homeowner is in fear of foreclosure, unsure of their home modification, gets a notice of any kind from the courts, they should immediately contact a reputable, foreclosure defense attorney. Colorado’s foreclosure laws are very complex and unique and should be handled by an experienced foreclosure defense attorney not someone exclaiming they can “rescue” you. The only thing these scammers rescue is your money to fill their pockets.
Keith A. Gantenbein, Jr. is a Colorado foreclosure defense attorney located in Denver and servicing all of Colorado. He also handles bankruptcies, mortgage negotiations, lender liability, real estate, civil litigation, contracts and landlord/tenant. If you think you will be facing foreclosure, or are in the foreclosure process, or have had a wrongful foreclosure, contact Keith Gantenbein at (303) 618-2122 for a one-hour consultation where he will discuss your situation and go over all your options with you.
This article is not intended as legal advice. The opinions of this article are solely the opinion of the author.