Scam artists are preying on families about to lose their homes and it’s happening in our area. We’re hearing about a new fraud scheme that appears to be help from a federal housing agency.
This comes as the number of vulnerable homeowners remains high. The number of homes that received first-time foreclosure status increased seven percent in March, up for the third consecutive month according to RealtyTrac, Inc.
Diana Dreifurst of Moline is facing foreclosure on her home of ten years. Several months ago she received a letter in the mail. “From what I thought was HUD in February,” said Dreifurst, “I called the number on there and they took my application over the phone.”
She thought she was applying for a loan modification through the Department of Housing and Urban Development, that would give her financial situation relief. The document looked official to her and so did the papers that came in the mail after that. “We got papers saying we were approved.”
Dreifurst sent checks totaling almost $2,000 to the agency for fees, and the next monthly payment. The checks were cashed at an account in California. But then Dreifurst was shocked to receive a court summons to put a sale date on the house. She tried calling the 888 number from the agency she sent the money to and only heard a busy tone.
“He said you guys got scammed, don’t send them any more money.” Those are the words of an attorney Dreifurst said she consulted. She learned she’s not only out $2,000, but could still be out of her home.
“You don’t know who to trust, you don’t know where to turn,” said Dreifurst.
The HUD office in Chicago has received numerous complaints on companies supposedly involved in foreclosure “relief” efforts. “People have called to say I’ve received a letter. They may have made reference to HUD, we try to get as much information as possible,” said Belinda Robinson, a housing program specialist with HUD.
The Department of Housing and Urban Development is not in the business of loan modification so that’s the first red flag. The next, “If they ask you for money, you can be pretty sure it’s a scam,” said Dawn Mutum-Plies, Director of Housing with United Neighbors. The agency in Davenport helps homeowners with housing counseling to help avoid situations like this. But, it is happening more and more.
“Unfortunately a lot of people that are facing foreclosure are desperate and for all the people that are out there’s people looking to take advantage of them,” added Mutum-Plies.
As for Dreifurst, she has 90 days to work things out with her lender before she loses the home. She says she’ll keep fighting to get back what she lost. “I don’t think we’ll see any of that money, but I just want people to know to be careful,” said Dreifurst.
Here are the red flags to look out for –
– a company advertises with flyers or solicits door-to-door
– if they ask for information like your social security number or loan number over the phone
– asking for upfront payment
– telling you to make payments to them or transfer your deed to them
If you think you’ve been had –
– fill out a police report
– contact your state’s attorney general’s office
– notify your lender
Counseling can help save you a lot of trouble. There are several resources for help in the Quad Cities area. Rock Island Economic Growth and Project now have housing counselors. So does United Neighbors in Davenport. Otherwise the HUD has a hotline at (800) CALL-FHA.