Homeowners who have fallen behind in mortgage payments should be aware of companies who offer to “help.” In many cases, the “help” is a scam that can lead to even greater financial difficulties.

Scamming companies can find troubled homeowners by looking at the public foreclosure notices. Some companies “guarantee” that they can stop the foreclosure for an upfront fee. Homeowners who fall prey to these scams usually find that their banks still foreclose on their home and they lose the upfront fee as well.

In another rescue scam, the company leads homeowners to believe they will receive a new mortgage loan. In reality, the victims end up signing over the title of their home to the company. The approach varies, but if a homeowner agrees to the terms, whether or not they fully understand the contract, they will eventually lose the home.

To avoid being victimized, refuse to work with a company that offers a guarantee, and advises to cease payment to the mortgage lender. Homeowners should be aware of any company that collects a fee for service not yet performed or accepts payment only by wire transfer or a cashier’s check. A company that offers to allow a homeowner to lease the property and buy it back at a later date should be avoided.

Homeowners experiencing mortgage trouble should consider any or all of the following actions to avoid foreclosure:

• Talk to the lender and try to renegotiate payments.
• Consider contacting a credit counselor through the Homeownership Preservation Foundation, a nonprofit agency that offers personal assistance to help home owners avoid foreclosure.
• Contact the Illinois Attorney General’s office help line at 866-544-7151.
• Consult with a private attorney.

Note: This information was prepared as a public service by the Illinois State Bar Association and is a joint project with the Illinois Press Association. Its purpose is to inform citizens of their legal rights and obligations.