For the first five months of this year, the office of Arizona Attorney General Terry Goddard has seen an almost 35 percent increase in the number of distressed homeowners who complained against fraudulent bank owned foreclosures prevention schemes.
And as more and more homeowners are falling victims to offers of help to arrange modification of their loans, refinancing or other foreclosure rescue services, the office of the attorney general has ranked loan modification as one the top 15 most common fraud in Arizona.
Goddard said the there are still many unreported cases of fraudulent bank owned foreclosures prevention schemes, adding that his office based its data only on complaints that were written or called by victims.
He pointed out that the most common form of mortgage modification fraud involves unscrupulous people promising troubled homeowners a lower loan interest rate by either reducing monthly payments or the loan principal.
These unscrupulous people would ask for advance fees from distressed homeowners and after receiving the money, it would be the last time that homeowners would ever see them.
Goddard said that homeowners who became victims of loan modification fraud were left in a worse condition than before while the people who committed the fraud walked away with their money to find another victim.
Goddard cited the case of Bobby John Herrera, a Glendale resident, who was convicted and sentenced to a five-year imprisonment as a result of fraudulent bank owned foreclosures rescue scheme. Herrera was able to victimize about 47 distressed homeowners in the Valley. He promised his victims that he would reduce their monthly loan interest rate and ask each of them $1,235 for fee.
Meanwhile, Larry Bush of the U.S. Department of Housing and Urban Development (HUD) said that the HUD is aware of the growing cases of loan modification fraud. He said that distressed homeowners who are anxious to save their homes from foreclosures are very vulnerable to fraud.
He warns them to be cautious of people who contacted them with offers of help instead of the other way around. He added that there are legitimate housing counselors in Arizona who are available to help troubled borrowers free of charge.
On the other hand, Goddard suggested that distressed homeowners who are facing the possibility that their homes will become bank owned foreclosures, should seek directly the help of their mortgage servicers or lenders or government-approved housing counselors.
Author Resource:-
John Cutts has been educated in the finer points of the foreclosures market over 5 years. Read bank foreclosures news at BankForeclosuresSale.com - Your online source for Foreclosures for Sale.
![[Valid RSS feed]](http://www.realestateproarticles.com/images/icon_Rss.png "XML Feed For RSS"){kind=icon}
Category Rss Feed
Print This Article
Add To Favorites