The ’sell home and rent back’ strategy has emerged in the real estate market owing to the fact that numerous borrowers are facing financial hardship and are quickly slipping into arrears. This scheme is often favored by homeowners hoping to avoid the foreclosure process. The sell and rent back strategy targets such homeowners. As debts and arrears grow the more such firms seem to be mushrooming. The main advantage of the sell home and rent back strategy is the discreteness of the process. Quite often the entire process can be completed without your neighbour or even family having any knowledge. These firms acquire the foreclosed property for a discounted price from the homeowner and the rent the same property back to owners at the prevalent market rate. This sell and rent back process however is not entirely advantageous to homeowners in distress, as quite often these firms make a nifty profit at the expense of another person’s misery.

Timeshares have become increasingly popular in the recent past. A lot of people nowadays while travelling prefer this way of staying in comparison to any thing else.  However, with the state of the financial world numerous people have experienced foreclosures on timeshares. The incapacity to make the repayments on these arrangements has meant that in addition to a flood of real estate into the market, there has also been a flood of timeshare foreclosures into the market. For a lot of consumers this represents an opportunity, which till recently did not exist. However, prior to buying a timeshare foreclosure there are a few things that consumers should keeping mind.

While foreclosures are very real in today’s real estate market, so are foreclosure scams, as we have previously discussed. Con artists and scammers are a fact that real estate investors cannot escape. They wait and prey on desperate homeowners who will give anything to prevent being foreclosed upon. This presents the best opportunity for foreclosure scammers as they are aware that the consumer in question is desperate and vulnerable, two qualities that foreclosure scammers love.  Listed below are some more of the most common foreclosure scams prevalent in today’s foreclosure market.

Foreclosure Scams Distressed Homeowners Must Avoid

• Mortgage Cancellation:  Foreclosure scammers misuse the otherwise effective strategy of mortgage cancellation. Instead of securing a second mortgage, as is the idea with a mortgage cancellation, foreclosure scammers use this to strip the property of equity. In reality, mortgage cancellation is the cancellation of debt and in accordance with the Mortgage Cancellation and Relief Act of 2007;there are no taxes due on the cancelled portion of the debt.
• Up Front Fee Real Estate Foreclosure Scams: This mortgage scam has become very commonplace nowadays. Scammers use the guise of agencies that promise to help struggling homeowners and demand large fees upfront from them. This amount is usually used to strip the equity of the property and following that it is sold to what is commonly known as a “Straw Dealer”. A straw dealer is someone who will put the house in his/her name and someone else will be living in it and making the repayments on it.  In essence you can be rest assured that this is illegal. If you are being asked to pay a large amount of money upfront which is not stipulated in any contract and you have been giving nothing in writing, you can be pretty sure that you are being conned. It is your best interest to immediately talk to the bank.
• Power Of Attorney: This is nothing but a trick to try and get possession of the property of innocent homeowners. While at times a POA may be necessary, during a foreclosure it is not. Scammers use POAs to place the property in their names. This is done more so when there is a tax lien foreclosure on the property. Scammers get the client to sign the POA in the hope that the foreclosure proceedings on their property will be stopped.  Having done this they will sell the Tax liens to investors who now have the property in their hands and in turn give the homeowners as much as 4 years to make the tax lien repayments, prior to it reaching the hands of a lien holder.
• Bankruptcy Scams: In this case foreclosure scammers come and advise you about filing for a refinance from a fraudulent bankruptcy operator. They will advise you make the repayments directly to them, while they quietly file for bankruptcy on your behalf. When the bankruptcy proceedings commence, owing to the fact that you are not there (this is of course because you had no idea about it), the judge will have no option to dismiss the proceedings and allow the foreclosure process to continue. Scammers do this only as a stall tactic and scam the consumer off their hard earned money.

To make sure that you are not being scammed, check with the Better Business Bureau if the agency that you are being approached by is listed with them. In addition to this it is essential that consumers do not provide any personal information without being provided with a contract.  No genuine agency deals without getting a contract signed. Make sure that you are dealing with the right person and insist on a face-to-face meeting and not just a telephone conversation. These are some facts that consumers should be aware of when looking out for foreclosure scammers.

As the economy continues to emerge from a crippling financial crisis, more and more homeowners struggle financially. As such the number of foreclosures to hit the market keeps increasing and the only question on the mind of all homeowners is “how do I avoid foreclosure?” One way to avoid a foreclosure is to seek professional help with regard to a loan modification.  The government under the Obama loan modification plan aims at helping borrowers who are currently struggling to stay afloat. However, there are a few things that you will need to know before you consider a home loan modification.

The real-estate market has seen the foreclosure numbers go through he roof. Owing to this fact real estate investors and first homebuyers have realised the potential to pounce on the opportunity and take advantage of rock bottom prices.  Foreclosed properties experience falls in market value of up to 35 percent and the same property can be attained at the sheriff’s auction for up to a 45 percent discount if you are lucky.  However the catch with that is you are competing against other buyer and in most cases the bank (first lien holder), as such it may be a good idea to use foreclosure listings. These listing provide you with valuable information on how to locate foreclosed properties, which the lien holders are and other relevant information. 

This may come as a bit of a surprise to some, owing to the fact that the Federal Housing Association /Department of Housing and Urban Development does not write loans. While this is rue, what is also true is that the FHA/HUD provides insurance to the banks and other lenders in the even of tem incurring a loss. When consumers apply for a home loan through a FHA approved lender, the credit officers working for the lender approve your loan. FHA usually does not have a say in this. Once an FHA backed mortgage security goes in to foreclosure after the lender has foreclosed on the property they submit the foreclosure property along with a list of costs and charges that are applicable t the foreclosure. HUD then pays off the lender and consequentially acquires the property.

As the market sees the number of foreclosures increase, banks and lending institutions are willing to consider foreclosure options that save them and consumers the pain of having to go through the foreclosure process. Consumers struggling with repayments and staying up to date with their mortgages have started to consider a deed in lieu of foreclosure.

There are nightmarish stories about angry homeowners who have stripped their homes of all the assets and fixtures. This is because for some reason they feel that it was the fault of the bank that the property was foreclosed upon. It is imperative that consumers understand that fixtures such as lights, fans, switches etc, are fixed to the property and are part of the house and land package which has been foreclosed upon. Dire consequences exist for homeowners who vandalize the property prior to vacating. In addition to this it is extremely inconsiderate owing to the fact that the next set of homeowners who will be looking to occupy the property and have saved and worked themselves to the bone will be coming into a property which is nothing shy of a war zone.

Consumers are feeling increased financial pressure in the wake of the global economic crisis gripping world economies at the moment. Now more than ever the country has seen a surge of foreclosures. In surveys conducted last year it was found that over 50 percent of the foreclosures which occurred across the USA were spread over 35 counties covering 15 states. These numbers accounted for some 1.5 million foreclosures to have been reported and carried out last year. It is only natural that consumers are looking for a way out and are asking how avoiding foreclosures may be possible.

Mandy Turnell is currently under financial stress owing to the fact that she is two payments behind on her mortgage repayments and feels that she might miss her third as well. Her husband was laid off work and although he has currently been re-employed their financial burden is far too much owning to their accumulated debt. Although they are considering filing for a chapter 7 bankruptcy they are unsure whether they have options.