WABC-TV Report Shines Light On New Jersey Foreclosure Rescue Operator

In Rutherford, New Jersey, WABC-TV Channel 7's Sarah Wallace recently did another investigative report on an area foreclosure rescue operator. Featured in her report was Scotch Plains, New Jersey-based Elite Services and its owner, Steve French. The deal in which he is accused of screwing over a homeowner facing foreclosure involved:

1. a sale to a straw buyer (who was paid $10K for allowing his name to be put on the title) with a contemporaneous leaseback which allowed the homeowner to temporarily keep possession of the home,
2. rent payments on the leaseback that were allegedly "hundreds of dollars more than the mortgage payments they couldn't afford in the first place,"
3. a new mortgage of about $100,000 higher than the amount owed on the old mortgage,
4. a home that ended up back in foreclosure.

Excerpts from the story:

• The FBI is now forming task forces all over the country to investigate the issue. Massachusetts is the first state to ban foreclosure rescue companies outright, and New Jersey may soon take action as well. [...] Foreclosure rescue companies are now under heavy scrutiny. New Jersey Assemblyman Neil Cohen plans to hold public hearings on these firms. "More of these companies are going to pop up," Cohen said. "So we either regulate them or we ban them."

For more, see Investigating foreclosure rescue firms.

Go here to view the pending New Jersey state foreclosure rescue legislation (which is a reintroduction of a bill from the last legislative session), New Jersey Assembly Bill A281 - Foreclosure Rescue Fraud Prevention Act.

For a related story, see PolitickerNJ.com: Cohen/Schaer/Spencer Bill Granting Subpoena Power To Investigate Foreclosure Consultants Advances.

For background information on foreclosure rescue scams, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams.