Bill Intended To Check Foreclosure Scams

Posted in Foreclosure Crisis, October 11th, 2007 |

Following the footsteps of foreclosure woes are scammers wearing rescue masks – out to dupe the vulnerable. They pick the bones clean leaving nothing but despair and hopelessness.
Jon Richards (D-Milwaukeee) compares the situation to a lifeline being turned into a noose to throttle the foreclosure victims. Together with Senator Jim Sullivan (D-Wauwatosa) Richards introduced the Homeowner Protection Act that will make it a criminal act to obtain property deed by deceit and falsehood.

At the root of the foreclosure rescue move is the re-conveyance contract. By it the title is transferred to the person posing as rescuer. The borrower is made to believe that this is the only way he can save the house. But the terms are couched in deceit and too late the ex-owner realizes that he has been taken for a ride. A representative of the Legal Aid Society opines that so far there has not come been a single instance of an ex-owner regaining lost ground via the rescue-scam route.

Milwaukee County was the happy hunting ground for sub-prime predatory lenders. Today it shares with the nation the rising rate in property foreclosures. A couple of vultures are now looking around to muddle up the mess further.

The new law is intended to rope in foreclosure scammers and send out warning signals. According to its tenets the owners must get a contract in writing with the right to cancel it within 5 days. Repayment is to be planned according to the ability of the owner. Any form of deceit undertaken to close the deal will amount to fraud. The idea is to protect owners from eviction and for this any complaint will primarily lead to delay in the process. The penalties that will be imposed on foreclosure scammers will be stiff – a fine up to $10,000 with the responsibility of paying for 150% of the damages. This package comes may come with the bonus of a visit to the jail.

More and more incidents of fraud are coming up leading to falling housing conditions. With resetting looming large more foreclosure listings are anticipated. This year the number of foreclosures may well reach 5,000. Since 2002 The Metropolitan Milwaukee Fair Housing Council has stumbled upon 800 loans that raise questions.
The bill is comprehensive and because of strong public feeling will in all probability it will pass through without a hitch.

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