Landlord advice: Hownowners, Avoid Foreclosure Rescue Scams

(source: Ga government)
Foreclosure scams come in many forms, but at the heart of each is a false promise that the firm will save the consumer's home. The Federal Trade Commission (FTC) urges consumers who are looking for foreclosure prevention help to avoid any company that:

• guarantees to stop the foreclosure process --- no matter what your circumstances
  
• instructs you not to contact your lender, lawyer, or credit or housing counselor
• collects a fee before providing you with any services
• encourages you to lease your home so you can buy it back over time
• tells you to make your mortgage payments directly to it, rather than to your lender
• tells you to transfer your property deed or title to it
  

The FTC says that consumers having trouble paying the mortgage or who have gotten a foreclosure notice should contact their lender immediately. They may be able to negotiate a new payment schedule. Legitimate help is available through the Homeownership Preservation Foundation (HPF), a nonprofit organization that operates the national 24/7 toll-free hotline (1.888.995.HOPE) with free, bilingual, personalized assistance to help at-risk homeowners avoid foreclosure. To learn more, visit www.ftc.gov/bcp/edu/pubs/consumer/credit/cre42.shtm

Common Scams

Scam artists follow the headlines, and know there are homeowners falling behind in their mortgage payments or at risk for foreclosure. Their pitches may sound like a way for you to get out from under, but their intentions are as far away from honorable as they can be. They mean to take your money. Among the predatory scams that have been reported are:

• The foreclosure prevention specialist: The “specialist” really is a phony counselor who charges outrageous fees in exchange for making a few phone calls or completing some paperwork that a homeowner could easily do for himself. None of the actions results in saving the home. This scam gives homeowners a false sense of hope, delays them from seeking qualified help, and exposes their personal financial information to a fraudster.

• The lease/buy back: Homeowners are deceived into signing over the deed to their home to a scam artist who tells them they will be able to remain in the house as a renter and eventually buy it back. Usually, the terms of this scheme are so demanding that the buy-back becomes impossible, the homeowner gets evicted, and the “rescuer” walks off with most or all of the equity.

• The bait-and-switch: Homeowners think they are signing documents to bring the mortgage current. Instead, they are signing over the deed to their home. Homeowners usually don’t know they’ve been scammed until they get an eviction notice.

Visit the following links for more information on "Foreclosure Rescue Scams" and how to avoid becoming a victim:

OCC Consumer Tips to Avoid Foreclosure Rescue Scams

Federal Reserve Board: 5 Tips for Avoiding Foreclosure Scams

National Consumer Law Center, Inc.’s Tips For Consumers On Avoiding Foreclosure “Rescue” Scams

Freddie Mac: Avoiding Foreclosure and Beware of Scam Artists

HUD: How to Avoid Foreclosure and Foreclosure Prevention Companies

Federal Trade Commission: Mortgage Payments Sending You Reeling? Here’s What to Do - Be Alert to Scams

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Eviction Information

Laws vary from state to state, but when you add up the costs and time down of an eviction, the results are the same. Preventative medicine is the solution.

Evictions Overview

When a landlord wants a tenant to move out, certain procedures must be followed. There are four types of evictions under the law, each requiring a certain type of notice:

For not paying rent. If the tenant is even one day behind in rent, the landlord can issue a three day notice to pay or move out. If the tenant pays all the rent due within three days, the landlord must accept it and cannot evict the tenant. A landlord is not required to accept a partial payment.

For not complying with the terms of the rental agreement. If a tenant is not complying with the rental agreement (for example, keeping a cat when the agreement specifies "no pets"), the landlord can give a ten-day notice to comply or move out. If the tenant remedies the situation within that time, the landlord cannot continue the eviction process.

For creating a "waste or nuisance." If a tenant destroys the landlord's property; uses the premises for unlawful activity including gang or drug-related activities; damages the value of the property; interferes with other tenant's use of the property; the landlord can issue a three-day notice to move out. The tenant must move out after receiving this type of notice. There is no option to stay and correct the problem.

For no cause. Except in the city of Seattle, landlords can evict month-to-month tenants without having or stating a particular reason, as long as the eviction is not discriminatory or retaliatory.

If the landlord wants a tenant to move out and does not give a reason, the tenant must be given a 20-day notice to leave. The tenant must receive the notice at least 20 days before the next rent is due.

The tenant can only be required to move out only at the end of a rental period (the day before a rental payment is due.) Usually, a 20-day notice cannot be used if the tenant has signed a lease. Check the specific rental document to determine if a lease can be ended this way.

If the rental is being converted to a condominium, the tenant must be given a 90-day notice under state law.

How must a landlord notify the tenant of eviction proceedings? For a landlord to take legal action against a tenant who does not move out, the landlord must first give written notice to the tenant in accordance with the law the landlord's options include personal service, service by mail, and service by placing in a prominent place on the premises. See the statute to ensure strict compliance.

What if a tenant continues to live in a rental unit after receiving notice? If the tenant continues to occupy the rental in violation of a notice to leave, the landlord must then go to court to begin what is called an "unlawful detainer" action. If the court rules in favor of the landlord, the sheriff will be instructed to move the tenant out of the rental if the tenant does not leave voluntarily. The only legal way for a landlord to physically move a tenant out is by going through the courts and the sheriff's office.