From Bad to Worse: Foreclosure Fraud
With more foreclosures occurring throughout the country, "foreclosure rescue" scams are also on the rise. From California to Indiana to New York, to right here in Minnesota, unsavory individuals have been calming the fears of residents facing foreclosure with promises of help, only to swindle them out of their homes and equity in the end. Thus, the end of the predatory lending outrage has simply transformed into the beginning of foreclosure fraud scandals.
Some elected officials have been requesting federal legislation to prevent predatory lending. Others have been asking lenders to voluntarily delay raising adjustable rate mortgage rates for home owners in the most trouble. Individual states are stepping forward in attempts to protect homeowners from this new scam as well. About twelve states have enacted laws designed to crack down on fraud by "foreclosure consultants" who claim to help homeowners in trouble.
Earlier this month, Attorney General Lori Swanson filed lawsuits in Hennepin County District Court against several out-of-state companies which had billed themselves in Minnesota as “foreclosure prevention experts”: National Foreclosure Relief; Lewis Loss Mitigation of Alabama, which also does business as Stop Foreclosure and Lewis and Associates Consulting; D.R. Financial Services of California, which also...