Federal Reserve offers tips to avoid foreclosure scams

Federal Reserve System Board of Governors presented the release regarding the mortgage foreclosure scams rise. According to Federal Reserve Governor Elizabeth A Duke, saving a home from foreclosure requires fast and informed action but the solution doesn't have to be costly. The Board’s intention is urgent for families who are struggling to remain in their homes. The Federal Reserve Board has compiled some tips to help protect consumers from becoming victims of foreclosure avoidance scams during the National Consumer Protection Week, March 1 to 9. 

The information the Federal Reserve is providing, which is part of its "5 Tips" series, is intended to give consumers the basic information they need to recognize and avoid foreclosure avoidance scams. This tips supposed to help consumers select a reputable counselor and avoid fraudulent foreclosure scams:

• Work only with a non-profit HUD-approved counselor. For a list of certified counselors visit www.hud.gov/offices/hsg/sfh/hcc/hcs.cfm or call 877-HUD-1515 (877-483-1515). If the name of the organization you are working with isn't on the list, then switch to one that is. 

• Don't pay an arm and a leg. Most housing counselors provide no- or low-cost counseling services. You should not have to pay hundreds, or thousands, of dollars for assistance.

• Be wary of "guarantees." No one can ensure you good results. 

• Know what you are signing. Don't let a counselor pressure you into signing paperwork you haven't had a chance to read thoroughly or that you don't understand. 

• If it sounds too good to be true, it probably is.

• If you feel you are a victim of foreclosure fraud, trust your instincts and ask for help. Report suspicious schemes to your state and local consumer protection agencies, which you can find on the Consumer Action Website.

Solicitors of foreclosure schemes reach out to potential victims by a variety of means using the Internet, the telephone, and direct mailings. Some solicitors go door-to-door or approach homeowners at events related to home preservation. Consumers are urged to check the credentials of counselors and to avoid working with someone who collects a fee before providing any services or accepts payment only by cashier's check or wire transfer. Consumers should not pay for a service without knowing exactly what they are buying. Details of the transaction, along with any promises, should be provided up front and in writing.