Last blog post I talked about Land Title Fraud as being one form of Real Estate Fraud in Canada. This blog will talk about another form of Real Estate Fraud: Foreclosure Fraud.
First, let’s discuss Foreclosure. Foreclosure is the process whereby the mortgage lender takes possession of a borrower’s home and sells the home to cover the mortgage debt and associated expenses related to the borrowers account which they have been unable to keep current.
When this situation happens a criminal will take advantage and offer the borrower a loan to cover the debt and expenses and consolidate the loans in exchange for up-front fees and an agreement to transfer the property title over to them.
The criminal will then keep all the payments made by the owner and ignore repaying any of the outstanding debts. They could also sell the house, refinance the house and leave with the proceeds.
In the end the homeowner is left still in debt, and likely in more debt, and will loose the home.
Steps to protect yourself include protecting your identity, contacting your lender if you are having problems making mortgage payments, seek legal advice before accepting someone’s assistance in settling your debt obligations.