Colorado AG Obtains $1.1 Million Judgment Against Foreclosure Rescue Operator
According to the allegations in the original complaint filed by the Colorado Attorney General:
- the "rescue" operators, through their unlawful foreclosure "rescue" program, acquired title to over 100 homes from homeowners facing foreclosure under the guise of "rescuing" their homes from foreclosure,
- the estimated market value of the homes in the Denver metro area exceeded $15 million,
- the homeowners were misled into signing over title to their homes in exchange for defendants advancing money for back-payments to bring their mortgage payments current and unwittingly became renters in their own home,
- the homeowners then leased their homes back from defendants with an option to repurchase their houses at an inflated price,
- consumers believed these complicated transactions were second mortgage loans and not the sale of their homes,
- within months, numerous homeowners were evicted after entering the "rescue" program,
- consumers were targeted through door-to-door solicitations and direct mail flyers advertising their "rescue" program as “absolutely free” and with “no cost to you,”
- in-home sales presentations were made to homeowners through high-pressure sales tactics aimed at convincing the homeowners that defendants’ "rescue" program" would allow families to stay in their homes, rebuild their credit, and keep their monthly payments low,
- homeowners were required to transfer title to their homes by quit claim and warranty deeds to the defendants and enter into lease option agreements obligating the homeowners to monthly rental payments sometimes hundreds of dollars more than their original mortgage payment,
- any missed rent subjected the homeowners to eviction and loss of equity,
- defendants would arrive at the homes with numerous contracts, deeds, and other pre-printed documents, ready to transact business,
- once the homeowner signed as instructed defendants would take the papers and refuse to leave any copies,
- homeowners were not given the opportunity to confer with advisors or to rescind the loan transactions within three business days, nor to cancel their credit repair service contract within five days, both rights of cancellation afforded by Colorado law,
- neither of these rights was disclosed to the homeowners, as required by law. The homeowners were not given numerous other disclosures of their rights, such as their right to redeem the foreclosure, stay in their home 75 days after foreclosure, and the ability to sell their property even after foreclosure,
- promises of credit repair were unfulfilled and homeowners were unable to refinance their homes, as they no longer had title to their properties.
For ColoradoAttorney General's 8/07/2003 News Release, click here.
For ColoradoAttorney General's 12/22/2003 News Release, click here.
For ColoradoAttorney General's 12/19/2001 News Release, click here.
For text of the Colorado Attorney General's Original Filed Lawsuit, click here.