Leaseback or repurchase scams target lower-income people who are having problems paying for the cost of their homes and mortgages. They arose during the early 2000s as a result of the subprime loans given by financial institutions to people who struggled with bad credit. Because of the rise of subprime loans, the market for equity trapped in indebted property arose in the form of mortgage scams.
Because so many individuals and families were racked by financial difficulties, these home repurchases seemed a welcome reprieve; homeowners would be released from their crippling debt if they gave their homes away. In the end, though, the homes often changed hands multiple times, leaving the tenants with exorbitant rental prices, unable to buy back their homes.
Certain people were particularly vulnerable to these scams because their debt had grown so large that the ability to decrease it was a logical opportunity. The lenders offered “miracle refinancing” or a chance to “save their home” from foreclosure. These words led the families to relinquish ownership of their homes to individual agents. A home that is going into foreclosure is broadcasted to these “rescue artists.” They offer the family or individual a plan that would appear to take away their hard dilemma, at first, but these agents didn’t actually have homeowners’ best interest in mind, and these unfortunate families “saved” nothing.
At its core, mortgage scams are concerned with the refinancing of a home that has become burdened with debt. But the harm they do is blatant. It is always important to keep in mind that it is better to have control over one’s property, even if it is saddled in debt. Often money lenders and other businesses are only looking at the money, not at the consequences for you or your family. Always go to unions or banks to figure out a solution that does not involve refinancing or giving away your home. If you’ve been a victim of one of these mortgage scams, call de la Riva Law Firm today; we can help!