That’s right, even when you’re losing your house someone is looking to profit from it by dinging you with foreclosure fees. It’s not enough that you’re losing your home, that the process is stressful and potentially embarrassing, but the lack of oversight in the foreclosure process also means that some places will try to squeeze a little more out of your wallet or pocketbook. If you are currently going through the foreclosure process, it pays to read this harrowing article on foreclosure fees in the New York Times.
In an analysis of foreclosures in Chapter 13 bankruptcy, the program intended to help troubled borrowers save their homes, Ms. Porter [associate professor of law at the University of Iowa] found that questionable fees had been added to almost half of the loans she examined, and many of the charges were identified only vaguely. Most of the fees were less than $200 each, but collectively they could raise millions of dollars for loan servicers at a time when the other side of the business, mortgage origination, has faltered.
The following story about Jennifer Falke and her family is one that you should be knowledgeable of if you are looking towards a third party to help you negotiate a positive resolution to your foreclosure woes. Falke contacted Foreclosure Assistance Solutions (FAS) and paid them money for them to negotiate with her lender. FAS took her money, did nothing, and now she’s not only poorer but she’s in a tougher spot with her lender because nothing happened in the time that passed. FAS took $1,200 and put her in increasingly more difficult positions, when she had money they told her that the fees would be more and more - essentially ripping her off and making it nearly impossible for her to get back on track.
She was told not to call her lender because it would only make it worse and eventually, since FAS stopped answering her calls, she did and found out FAS was lying to her in the first place and inflating the cost of catching up. Here are some tactics they try to use to rope you in:
* Saturation marketing: They learn of mortgage delinquencies through published reports and proceed to bombard the owners with phone calls, flyers and posters.
* Exploiting trust: Scammers build trust by acting sympathetic and solicitous; many owners can’t believe they would lie to their faces.
* Isolating owners: Scammers assure victims that they’ll handle everything. They tell them not to call their lenders nor seek legal advice.
* Outright fraud: Scammers have homeowners sign blank papers and fill them in afterward or they sneak the paperwork through without telling victims what they’re signing.
* Affinity marketing: Especially among minorities and sometimes evangelical church congregations, a scammer builds trust based on a common ethnicity or religion.
The article recommends that you talk to your lender directly as soon as possible, that’s absolutely your best bet.
Source: Money.com