The thought of losing your dream home because of foreclosure can be difficult to stomach. Many people who are in this position will grasp at straws to try to keep their home. The issue with this is that they might end up falling for a foreclosure scam that ends with them facing financial hardships and still losing the home.
Before you decide what to do about your foreclosure, you should learn about ways to spot these scams so that you can avoid them. Essentially, one of the best things you can do is to take the time to investigate any company or program you are considering.
Signs of a foreclosure prevention scam
One thing that might tip you off to a foreclosure prevention scam is that the operator of the scam contacts you without you taking steps to find out about the program. Cold calling people who are listed in the monthly foreclosure filings is a common tactic of these scammers. They prey on the fact that you might be desperate to save your home.
Another sign that a program might be a scam is that they often ask for you to sign the deed of your home over or they ask you to make your mortgage payments to them. They claim that they will work out a deal with the mortgage company. However, they don't do this. Instead, they keep the money and let your home continue down the foreclosure road.
Ultimately, you will find that you have lost all the money that you paid to the scammers and your home is still in foreclosure. In some cases, the scam has gone on so long that you don't have any options left to keep your home.
Legitimate options to halt foreclosure
There are some legitimate options for you to halt a foreclosure on your home and allow you to remain in the home. One option that might work for you is to file bankruptcy. In this case, the halt is only temporary but it does buy you some time to work things out with your lender.
The good thing about taking this step is that the bankruptcy filing can reduce your other bills, which can free up some money to put toward the mortgage. It might also be possible to work out a deal with the lender without filing bankruptcy. However, time constraints and overwhelming payments on other credit accounts might make it much more difficult to keep up with payments on a revamped mortgage.