Foreclosure crisis profiteers: Knowing the enemy

Our previous two posts dealt with the origins of the Foreclosure Rescue Scam and provided some characteristics to help homeowners recognize a scam from a safe distance. Even armed with good information, it’s sometimes hard to differentiate the good guys from the bad.

The scammer is well rehearsed at sounding smart, compassionate and sincere. At Keep Your Home California, we investigate these people fairly often and we seldom find conclusive evidence of their misdeeds. In this post, we will provide you with some practical steps that you can follow to review and identify these con artists. Warning: None of these techniques are foolproof and it’s very difficult to identify a scammer with any level of certainty.


It is our hope that by doing a little research, you might uncover enough “red flags” to steer you away from potential danger before you lose any money. Here are a few simple steps that you can take to perform a high-level review:

  • Review correspondence from the potential Scammer. It’s likely that most of your contact with a scammer will be by email and telephone. The scammer typically doesn’t want to meet face-to-face. It’s unlikely they have an office and they might be located nowhere near you. Look at their email address. Is there a company or organization designation? Very often, scammers use public email services such as Hotmail, AOL or Gmail because they don’t work for a legitimate organization. A public email address is a red flag.


  • Ask about and verify licenses. Sometimes the scammer claims to be an attorney or claims to have a real estate license. They may tell you not to contact your lender, lawyer or credit counselor. Ask for their license or bar number and then verify the license with the State Bar of California or the California Bureau of Real Estate. Even without a number, you can search by name.
    • For an Attorney Search, go to Contact the attorney using the phone number listed in their profile, not the number given to you by the Scammer, to verify that the person listed is actually the person who contacted you.
    • To verify a Real Estate License, go to Independently locate a phone number, using the internet or other genuine phone directories, and contact the person to verify that the person listed is actually the person who contacted you.


  • Evaluate their website … if they have one. The absence of a website is a major red flag. However, most scammers have a website. And, because they often have to change names to elude being caught, their websites are usually very sparse. A few pages without much real content and almost never the names, or photographs, of any employees, managers or executives. Their “Contact Us” page will usually be limited to an online contact form. No physical address, no phone numbers, no email addresses.


  • Check their physical address. If you do happen to have what appears to be a physical address, put it into Google Maps and see what appears. Go to the “Street View” if it is available. You might see an office building or a private residence but, more often than not, you will see a shopping center and one of the tenants in that shopping center will be a UPS Store, or similar mailbox service. Red flag!


  • Perform an Internet search. Use an effective search engine and look for the name of the company, of any individuals you can identify, and also search phone numbers that you have been given. If you poke around enough, you just might find useful information such as previous complaints.


  • Requests for fees. Any request for fees or money before any services are performed, payments in cash, money order or “wire transfers” are all warning signs.

Please remember that you might be dealing with criminals and we aren’t advocating that you become a private investigator or vigilante. Do not, in the course of your review, misrepresent yourself or violate anyone’s rights or privacy. If your research indicates that you are likely dealing with a Scammer, do not confront them, simply disengage.

Image courtesy of Stuart Miles at



Foreclosure crisis profiteers (Part 2): Seeing through the camouflage

In our previous post, we discussed the rise of the “Foreclosure Rescue Scam” in California. We fittingly described the scammers as predators and, like most predators, the scammer looks for the most vulnerable and helpless of prey.

In this case, they are seeking homeowners who, facing the frightening possibility of foreclosure, are desperately grasping for any possibility of regaining their financial footing and saving their home. The scammer hopes that fatigue and fear will cause the homeowner to drop their guard, to cling to false promises, and to surrender both their hope and what little money they may be able to scrape together.


The challenge is that the scammer is camouflaged and really hard to spot. He looks legitimate, sounds confident and says all of the right things. But, upon closer examination, the scammer can be identified for what he really is — a fraud.

Look for these warning signs of a scam:

  • Promises of guaranteed results. The scammer will say that he has done this hundreds of times, that he has relationships with loan servicers and that he knows exactly how to work the system in order to stop every foreclosure and save every home. No legitimate foreclosure prevention program will make these types of unconditional claims.


  • Instructions that isolate the homeowner. The scammer doesn’t want a homeowner talking to their loan servicer, to a certified housing counselor, to an attorney or to a real program such as Keep Your Home California. Their scam depends upon their ability to make a homeowner believe that their only hope begins and ends with the Scammer.


  • Advice that includes not making, or diverting, mortgage payments. The scammer wants money. It is to his advantage to convince a homeowner that they should not send money to their loan servicer. While not a common practice, the scammer will sometimes convince a homeowner that, in addition to fees, they should also send their mortgage payments to the scammer to be held in trust until their modification is complete.


  • Asking for upfront fees or a payment plan. The scammer will insist that the homeowner immediately begin paying his fees and he will try to get as much as possible in the first payment. Fees can range from several hundred to, more often, several thousands of dollars. The “sweet spot” in California seems to be fees of about $3,000, but we’ve seen people taken for well over $10,000. The scammer is an opportunist and he will take as much as he can get and he is willing to set-up a payment plan if that means draining even more of the homeowner’s scarce resources.


  • Any scheme that involves transferring title to a home. Some of the more elaborate scams involve transferring all, or part, of a homeowner’s interest in their property. It seems illogical to think that someone would transfer title to their home in order to save it, but it happens often. The scammer will describe a complicated scheme that may involve the homeowner leasing their own home and earning their title back over time. Once title has transferred, these scams are very difficult, and expensive, to undo and likely will require the help of an attorney.

If you believe that you have been the victim of a foreclosure rescue scam, the following Government agencies offer the opportunity to file a complaint:

If you suspect fraud or misrepresentation related to Keep Your Home California, please contact our Compliance Unit at

In our next installment, we will discuss some simple steps you can take to verify the legitimacy of anyone who approaches you offering help with foreclosure prevention.


Foreclosure crisis profiteers: Feasting on fear!

Losing a home to foreclosure is most often viewed, by those standing safely outside the transaction, as an economic event. And that is certainly true.

However, for those living under the threat of losing their home, the experience is much more personal.

The thought that one’s home might be involuntarily swept out from under them unleashes a flood of emotions that may include fear, anger, depression, shame and frustration. People in the foreclosure process seldom mention money or wealth creation or asset preservation. They speak instead in terms of not uprooting their kids, of loving their home, their neighborhood and their schools.

FRAUD. Yellow warning tapes

We have heard firsthand many of the voices of those standing on the brink of losing their home. Even when clouded by anger, their words are filled with fear and anguish and desperation.

As with any disaster that leaves in its wake hurting and desperate people, the foreclosure crisis gave rise to a class of ruthless predators seeking personal gain at the expense of those who can afford it least.

Foreclosure rescue scams were born as a growing number of Californians were fighting to save their homes while facing a complex and daunting foreclosure process. Legitimate sources of assistance, such as the Home Affordable Modification Program (HAMP) and Keep Your Home California (KYHC), also arose as viable options for homeowners, but often the false hope and empty promises of the scammers drown out the messages of these bona fide programs.

Over time, the scammers learned how to look and sound like real rescue programs. They frequently adopt names with elements of HAMP or KYHC embedded in them. To the untrained eye, their websites look legitimate, often using language and graphics taken directly from

The scammer sometimes tries to look like a government agency, sometimes like a law firm and sometimes they even have on their websites warnings about foreclosure rescue scams. Many of these con artists worked previously in the mortgage industry – so they speak the language. They look legitimate, say all the right things, and make promises that speak to the deepest fears of a homeowner in crisis.

The scammer leverages the emotions of hurting and scared people and then tries to strip them of what little resources they have remaining. In addition to having their money stolen, homeowners in the hands of a scammer lose valuable time and often go so deeply into the foreclosure process that any chance they had of saving their home, and any shred of remaining hope, is gone.

The scammer claims to have special powers over Loan Servicers and promises to fight for the homeowner, stop their foreclosure, and make all of the stress and turmoil disappear. To a beleaguered homeowner, weary from the fight, the scammer looks like an ally and a savior. But know this, these thieves have no influence, no power, and the only thing they want to relieve a homeowner of is their money.

In our next installment, we will discuss the keys to identifying a scam and what actions should be taken if you have been the victim of a foreclosure rescue scam.