Real Estate in West Orange
Marsha Bowen Washington
973-510-0014973-510-0014

Bankruptcy Scams on the Rise for Distressed Homeowners Facing Foreclosure

 

As more distressed homeowners seek to save their homes from foreclosure, several are being duped out of thousands of dollars with bankruptcy scams.  Although filing a bankruptcy can stop a foreclosure from happening, this is only a temporary action.  Once the bankruptcy is discharged or dismissed, this makes it easier for the lender to move forward with the foreclosure action.   In addition, a lender does not have any obligation to offer a homeowner a modification after bankruptcy, specifically a Chapter 7.  The latest bankruptcy scam might give homeowners more time in the house but it’s costing them money they could have used to avoid an eviction or relocate before the foreclosure action.   Most lenders are open to do a short sale or deed in-lieu if the window of opportunity isn’t so tight between the foreclosure sale date.

The latest scam is the partial interest bankruptcy scam.  The scam operator asks you to give a partial interest in your home to one or more persons. You then make lower mortgage payments to the scam operator in lieu of paying the delinquent mortgage.  However, the scam operator does not pay the existing mortgage or seek new financing.  Each holder of a partial interest then files bankruptcy, one after another, without your knowledge. The bankruptcy court will issue a “stay” order each time to stop foreclosure temporarily.  However, the stay does not excuse you from making payments or from repaying the full amount of your loan.  This complicates and delays foreclosure, while allowing the scam operator to maintain a stream of income by collecting payments from you, the victim. (Source: FDIC)

The best defense to avoid foreclosure is to get help as soon as possible.  Homeowners that ended up doing short sales from 2009 to 2016 were able to avoid a tax liability on their loan balances after their short sale closed.  Unfortunately, the mortgage debt relief act has not been renewed under the new administration,  so homeowners that are foreclosed on will not be exempt from this tax liability.

To learn more about options to avoid foreclosure, visit:  www.HAFAhelpforhomeowners.com

 

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About Marsha Bowen Washington

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Marsha Bowen Washington

Realtor/Sales Associate

marshabwashington@yahoo.com

973-510-0014973-510-0014 main

Coldwell Banker Residential Brokerage

2 E. Mt. Pleasant Avenue Livingston, NJ 07039

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5ChristinaPamplin

Marsha was highly professional and knowledgeable about the real estate market. She made me feel very confident that I was in good hands. When I began to feel nervous and stressed, she stepped in and assisted with following up with my lender and attorney to... (more)

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Marsha Bowen Washington is the real deal! She's knowledgeable, friendly, patient, committed, and caring. My real estate venture was very challenging and Marsha stuck with me throughout the whole process even though I extended my search outside of her... (more)

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if Marsha had anyother skills besides real estate, my husband and I would use her in those areas as well. She has such calmness that the worst clamity, seems nothing when she is dealing with things. It was the most effortless journey and a pleasure working... (more)

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