Foreclosure Rescue, Loan Modification Scams Gain Increased Attention From FBI

The Washington Post reports:

• Nationwide, the number of mortgage fraud suspicious-activity reports referred to law enforcement increased 36 percent over 2007, [according to the just released FBI's 2008 Mortgage Fraud Report]. And the government's economic stimulus programs could fuel further increases, according to the FBI [...].

The FBI report points out that fraud involving foreclosure rescue and loan-modification schemes are "emerging as recent vulnerabilities."

• Perpetrators solicit homeowners with mail flyers offering to help them stop the foreclosure process on their homes. Homeowners are falsely told that their mortgages would be renegotiated, their monthly payments would be reduced, and delinquent loan amounts would be renegotiated. ... Perpetrators require an up-front fee ranging from $1,500 to $5,000 from homeowners. ... Perpetrators often request that the victim homeowners stop payments and communication with their lender. When victims receive delinquency and foreclosure notices, the perpetrators convince them that the loan was renegotiated, but that the lender needs a good faith payment to secure the new account.

Source: Mortgage Fraud Rising.

Go here for the FBI's 2008 Mortgage Fraud Report.